Chip and Pin Cards Still Not Available Worldwide

For those who are planning to travel out of the country this spring or summer, sadly, you are almost certainly not yet able to use the “chip and pin” credit cards.

Nowadays, banks all over the world apply two credit card systems. First, the stripe-and-sign system, and second is the chip-and-pin system.

The stripe-and-sign system, which is still used in United States, involves programming identifying information on magnetic stripes on the back of a card. Then, when credit card holders want to make a purchase, the card is swiped through a device that reads magnetic stripes, a charge slip is printed, the slip is signed by the credit card holder, and copies of the slip are presented to banks.

On the other hand, the chip-and-pin system involves programming identifying information on a memory chip, which is then embedded in the card. The card is used by inserting it to a reader, entering a PIN, and the rest is done by electronically. This chip-and-pin system has been in use in developed parts such as Canada, Europe and a lot of Asia.

In countries where the chip-and-pin system is used, cards from American Express, MasterCard, and Visa can be accepted. However, if a computerized system is better or the only payment system, then your credit card won’t do.

Cards that come with a magnetic strip and a chip are now being released by banks in some countries.

However, banks who issue airline co-branded cards are not offering dual cards. In fact, only JP Morgan Chase bank in US issues co-branded cards that also offer chip and pin cards.

Moreover, there are no domestic mileage-earning cards that offer the chip alternative. Hopefully, an action will be done this summer according to Bank of America spokesperson. Wells Fargo is the only other bank in US that offers chip-and-pin cards, but they are still trying it out with chosen customers.

Still, there is a delay for the banks to issue chip-and-pin cards because of certain reasons, although they are aware that the chip costs less than $1.

On the positive side, an increasing number of credit cards no longer have foreign exchange fee, and some only have 1% charge. You can visit websites like nerdwallet.com, cardhub.com, creditcardforum.com, or cardratings.com to check the list of credit cards.

6 Blunders You Need to Avoid

Money they say is what makes the world go round. It a luxury not everyone can afford, so to avoid further future financial problems you should learn the no-no’s on handling money and banking.

Here are some blunders people make about money and banking:

First, being unable to save for unforeseen emergencies, it’s wise if you have savings for emergencies and other unexpected events that might happen in the future. It can be something like a contingency fund, when something goes wrong. The money could be used to pay for your hospital bill, or car, it can keep you going for months when you suddenly lose your job, etc. So always make it a point to save, even if it’s only a dollar every day that would make all the difference.

Second, learn how to make a budget and follow it, budgeting does not disallow you to buy whatever you want. On the other hand, it is a helpful tool to ensure you buy what you surely need. It also allows you to monitor your expenses, making you more conscious about how much money you might be wasting on useless things.

Never let your bad spending habit cause you to overspend. Though budgets may be hard to follow at first, in the long run, it is a guaranteed life saver. So always keep a notebook close and record what you are spending, you might be surprised with how much money you are “burning”.

Third, relying on credit cards and rewards cards to pay for all your expenses, sure these cards can payoff everything, you don’t need to pull out your cash. But that is a big mistake. Paying with credit cards will only cause you to have more debts, and it will lead you to eventually feel meager. Don’t let your debts take over your life. Pay off your bills now, and use money to buy things, this will make you more conscious if you really need the item or not.

Fourth, borrowing money to pay off a liability, like the saying goes: “don’t fight fire with fire”, when you are promised that your problems will be solved, they are lying. Paying through borrowing does not make the debt go away, it just gets transferred. It’s a short-term solution that does not make the problem go away, just adds to it.

Fifth, taking advice to “opt in”, sure the fear of the unforeseen can really make you want to do everything you can right now to prevent it from happening. But writing too many checks or using your debit card to pay for payments will just add fuel to the fire. Bankers make estimations about people’s situation and encourage them to “opt in” to their plans of protection so that people can buy things they “need”. But really this is not solution. The better solution is to stash money and save for the unforeseen disaster.

Finally, taking on your debts alone, sure you want to keep to yourself when it comes to financial problems, but if every effort you try is in vain, then that doesn’t make you weak, it just means you need help. If you find yourself struggling to pay off your debts on time, find someone trust worthy to help, like a non-profit organization. You can always pay a free visit to the National Foundation for Credit Counseling or the Association of Independent Credit Counseling Agencies.

Best Buy Placed on Credit Watch by S&P

Last Wednesday, the shares of Best Buy Co. Inc. fell to 2.55 percent because its corporate credit rating was only one level ahead of the so-called “junk” status.

Best Buy, an electronics retailer in Richfield, was put on credit watch with negative implication by Standard & Poor’s Ratings Services. The statement was made one week after Best Buy revealed it is planning to close 50 branches and take some actions that will cause a lot of discharged employees and approximately $800 million worth of savings after five years.

At present, Best Buy has a BBB- credit rating, which is the lowest investment-grade. After that is the BB+, which is a non-investment grade or simply known as the “junk” status.

According to Jayne Ross, director of Standard & Poor’s Ratings Services, the restructuring of operations was brought about by the problems Best Buy is facing in terms of its business model.

In addition, Ross said that a company placed on credit watch means there is one-half probability the current rating will be the same and the another one-half probability that the rating will be demoted.

Best Buy replied through email that they are conscious of S&P’s decision to put their company on credit watch. In addition, they are willing to discuss with S&P for further information about their business strategy. Best Buy said they have a good overall financial condition as evidenced by their ability to generate cash for operations and free cash flow, and their $2.5 billion credit capacity with major banks.

Moreover, they have a high level of flexibility and financial awareness because of their ability to generate excess cash and conventional capital structure.

However, they refused for an interview asking the company officers to talk about the rating.

The credit agency might demote the rating in a span of 90 days, that is, if there are no actions done by the company to give details or improve factors that cause the credit watch. Standard & Poor’s looks forward to settle the issue after talking with Best Buy’s management.

Don’t Make a Deal to Get Better Credit

Who would not want to try out a deal, when it will only take you a couple of bucks to get a better credit score?

Today, a lot of ads from fliers to large billboards offer this opportunity for customers but really, even if money is indeed to boost your credit you do not need other people to do that for you. Oftentimes, instead of helping you gain a better credit, they give you with a bigger headache.

Take the experience of Pine Bluff, he gave $500 so that he could have his credit score improved. His long wait for the credit status improvement never paid off. Bean Eagle, the man he gave the money, was nowhere to be seen.

After searching for Ben’s whereabouts, the authorities found out that he has been locked behind bars for over a year, and he’s got another year to go to for his sentence: insurance fraud.

Clients should be careful who they give their trust to. Here are some things you should always put to mind: don’t trust anybody who asks for money in exchange for good credit or if that somebody tells you that talking to credit bureaus will be no help.

Bad credit is not the kind of problem that goes away overnight. When someone asks you to drop everything and leave it all to them that they will take care of your problem, they are lying.

Anyone who is really willing to help you restore your credit will ever charge money. They will not take the responsibility of improving your credit score for you.

So, you want to have better credit? Take these tips at heart: first step in recovering from bad credit, pay bills on time, even if you just pay for the minimum amount. If you fail to pay on time, don’t wait after a month to settle the account.

Second, always check your credit score and review them for possible mistakes. Finally, use money to pay for your purchases and bills until your credit account is back on track.

Benjamin Eagle may be behind bars, but he’s not the only criminal who’s willing to prey on unknowing clients.

Borrowers Must Challenge Credit Card Debt Charges

It is recommended that every borrower must challenge credit card lawsuits, according to Felix Salmon, who is a Reuters blogger.

This recommendation is to some extent valid. For instance, the case of Bank of America and its credit card division showed that creditors have the capacity to force collection bureaus to pursue debts that are not valid. This consequently puts the collection bureau into greater jeopardy than Bank of America imagined it would be in itself.

If the debt is in reality not valid, then it would seem right for the consumer to challenge a lawsuit.

In contrast, Salmon’s recommendation becomes odd when he said that borrowers must not be afraid to require a proof out the upright feeling that they must pay off their outstanding debt.

This is not in the best interest of a lot of persons who are in some way associated with the consumer.

First is the creditor, who gave the loan to the borrower for him to use in whatever he thinks he should buy.

Second is the collection bureau, which now has the responsibility to take care of a borrower who believes he is not to blame for the liability he made.

Third are the borrowers who pay their credit card debts in good time.

Fourth are the borrowers who have to sort out higher costs because of the consequences of poor retail debt.

In addition, Salmon has a poor conclusion. He said that if all persons begin to challenge the lawsuits as a whole, then that will certainly lessen the advantages, to the financial institutions, of advertising written-off debt to corrupt collection bureaus as a whole.

However, it is probably unreasonable to classify collection bureaus who buy credit card debt as corrupt. It weakens a significant component of the receivables management business. Also, it weakens the business that places persons to work in all types of profitable settings.