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Companies Using Instant Payments to Attract Employees

The pandemic left a major impact on the way things work. From business operations to the way we interact – it affected everything. It also pushed companies to reconsider the incentives they use to attract employees. This is largely driven by employees’ newfound demand for remote working opportunities. Another example includes applications that allow workers to get paid on a daily basis. With just a few clicks, they can withdraw money as soon as their shift ends.

There’s immense competition among businesses to hire the right hourly workers as the labor market is very tight. This has created a situation that favors the worker because they now have a variety of options to choose from. The current condition of the labor market has led to these applications becoming a key recruiting tool. Company owners using these instant payment methods explain that these have helped them attract new employees and manage their money better.

Job candidates can easily go onto the application and see how much they can earn on an hourly basis as their work shift continues. Since workers find this system very convenient, many recruiters are marketing its integration to draw more applicants to their companies.

Employees are also starting to recognize how great it feels to clock out after a shift with more money in their bank accounts. Hourly workers see numerous benefits of such a system, like having gas money for one’s car immediately after a shift, making instant pay seem like a practical solution for employers.

Early Adopters of Instant Pay

Some of the first businesses that implemented instant pay include nursing homes, and they continue to use this technology today. Moreover, millennials find the instant payment system to be ideal since it fits right into their lifestyle. To start with, instant pay solutions are easily compatible with mobile applications and digital solutions.

Tech-savvy users who describe themselves as digital natives find this feature quite lucrative. Nowadays, candidates and prospects are actively looking for such options on social media so that they can land a job where they can enjoy flexibility through instant payment systems. To integrate a payment method that helps employees get their hands on their money instantly, companies are relying on applications such as Instant Financial. This application allows workers to get paid a few minutes after clocking out.

One aspect of a weekly payment system that attracts employees is that they’re able to save money by getting an accumulative amount at the end of the week. This way, the application also caters to workers looking to save money through weekly payments.

It has an option that allows employees to control how much money they get at the end of the day. For instance, they can choose to withdraw only 50% of their earnings at the end of the shift. This will allow them the flexibility that millennial and tech-savvy prospects demand. For companies looking to attract new talent, applications such as these prove quite effective.

Instant pay systems, applications, and other new ways to pay that are similar have been at the forefront for many giant companies and retailers when it comes to recruiting. With applications such as these, employees are leveraging the convenience of being able to access their funds instantly. What’s more, these types of apps keep you from delaying necessary tasks simply because you’re waiting for your next paycheck to arrive.

Pay Apps and Their Benefits to Employers

Overall, an employer’s biggest win is employee retention. If they can keep an employee satisfied enough to remain in the company for a long time, it increases productivity and helps with growth. In a competitive environment where many companies are implementing tactics to attract prospects, this can be difficult.

Implementing innovative payment systems for instant payments can prove integral for employee retention. This can solidify an employer’s employee base and help them form a satisfied workforce. In the long term, this can improve productivity and help ensure the company’s growth.

It’s also worth keeping in mind that instant pay options keep employees from seeking short-term loans and lending opportunities. Such loans, often called payday loans, can potentially put them in never-ending debt. Lending and borrowing never come without stress and emotional burden. Employers can prevent this from happening by helping them get paid quickly. This way, employees can avoid troublesome bill collectors, tax collectors, and landlords pushing them to make payments.

When you pay employees as soon as their shift ends, they no longer have to loan out products and services at hefty interest rates. This has a resounding impact on their finances and keeps them emotionally and mentally healthy. These applications also help reduce employers’ burden since they no longer have to make special amends to ensure employee satisfaction.

Financial Stability Factor

Debt can single-handedly make things very difficult for a happy employee. The fact that daily payment systems can help workers dodge stressful debt makes it an impeccable solution for employers.

Employers can use many angles when trying to attract employees with instant pay, with one of the strongest ones being the ability to control how much money you make in a company. After all, the rewards of your labor should be instantly redeemable since you’ve put in the effort to produce results.

Final Words

Companies are beginning to realize this, and applications and systems are making it possible for them to implement it. This is an employee benefit that has the edge over all others when companies are trying to retain and attract employees.

FIS and US Treasury Team up to Release Embedded Finance Tool

On May 11, the Fintech Firm FIS and the Banking-as-a-Service startup Treasury Prime revealed through a press release that they are partnering to launch an embedded finance tool. One of the main reasons they cited was the growing need for financial institutions to provide digital banking experiences to their customers, a necessity that is exacerbated by the digital transformation of the global economy.

In their statement, FIS remarked on embedded finance being a key trend in the finance industry, as it allows companies the ability to provide FinTech services through their digital channels such as payments, banking, investments, credit, and insurance.

This news comes just a month after FIS unveiled its Banking-as-a-Service Hub, on April 12. Back then, FIS said this tool would provide institutions of all sizes a full suite of banking and payment capabilities, as well as allow them to configure new financial service offerings with ease.

FIS’ aim with this tool is to provide small to medium-sized financial institutions with the necessary tools to complete, thanks to improved digital banking services. According to FIS’ release, this tool would allow the institutions to provide new methods for managing deposits and accounts payable transactions, as well as other banking functions, remotely and digitally.

FIS’ Head of Payments, Kelly Beatty, stated in the release that embedded finance is growing as a trend due to the way it empowers businesses to quickly implement innovative ideas through the combination of financial services with user experiences. One example she mentioned was how embedded finance allows commercial services like lending and insurance to be handled with the same convenience as regular app purchases.

Beatty also stated that the needs of the customers was the focus of these services. In the release, she said that customer’s expectations could be reached through the integration of financial services into business software, new channels can be created that can reach even more financial services.

On their end, Treasury Prime’s CEO Chris Dean said that the banks that take advantage of these embedded services can become the foundation for a new generation of financial institutions, and that embedded finance could bring them new potential revenue streams.

In the press release, it was also revealed that Grasshopper, a digital commercial bank, would be the first financial institution to use FIS’ embedded services tool.

The market for embedded finance experiences continues to rise, with one study finding that 23% of consumers had used buy now pay later (BNPL) to split large purchases into smaller installment payments at the point of sale (POS).

FIS Acquisition of Payrix Expands its Offerings to Include Payfac as a Service

In their increased bid to boost their embedded finance capabilities, Fintech platform FIS has acquired Payrix, the embedded payment company. Payrix was founded in 2015 and has provided embedded payment solutions to serve SMB eCommerce merchants.

According to their press release, this would boost their eCommerce offerings to companies regardless of size or industry, through the addition of embedded payments using a Software-as-a-Service platform (SaaS).

This continues FIS’ expansion of payment capabilities that started with the acquisition of Worldplay in 2019. The acquisition will allow FIS to expand its reach to a global scale, as well as include new capabilities such as automated digital onboarding, billing, compliance, and settlement. This would let the company expand into the SMB eCommerce market, as well as others.

This acquisition gives FIS more share in the embedded finance industry, where they were already a powerhouse in terms of banking solutions for depositing, lending, or issuing payment assets.

FIS didn’t disclose the terms of the acquisition, nor were they included in their February financial results.

FIS’ bets for more embedded finance services are grounded in reality. 60% of decision-makers at financial institutions in the UK have integrated at least one piece of digital technology in the last year. Embedded finance services are quickly gaining popularity worldwide. Around 57% of legacy financial institutions expected to take advantage of FinTech partnerships, with close to 48% of them seeing this as essential to innovate. Furthermore, 52% of these institutions are considering the potential of developing disruptive technologies, while 25% believe that they can make their services more appealing through their use.

Everything points to FIS making the right decisions in terms of acquisitions, with the payment and finance sector quickly evolving and companies rapidly absorbing one another. FIS’ rival, Fiserv, acquired the remaining stake of Finxact for $650 million, while another company, Fintech Amount, bought Linear for $175 million. This was around the same time that NMI, the global payment platform, acquired IRIS.

For their part, FIS reported net earnings of $4.1 billion for 2021. This was an increase of 19% over 2020, with their fourth-quarter alone reporting $1.2 billion in net earnings, up 16% from the previous year. Their revenue, meanwhile, was up 11% both for their fourth quarter and the whole year of 2021. Revenue for the fourth quarter was $3.7 billion, while the year as a whole saw $13.9 billion in revenue.

Inflation Moderates Slightly in March 2022 After Increasing for 8 Months

The consumer price index (CPI) fell from 8.5% in March to 8.3% in April, according to the report from the U.S. Bureau of Labor Statistics, failing to meet the expectations of Wall Street for consumer prices and inflation. Economists had previously forecasted a drop to 8.1% for the same time period, owing to raises in rates from the Federal Reserve. However, it still was the first drop in eight months. While experts believe that inflation may finally have peaked, others feel that the Federal Reserve will need to be more aggressive regarding the interest rates for things to return to normal levels.

This is reflected in the way that prices went up. The consumer price index went up 0.6% for most items between March and April, with the exception of groceries and gas. Wall Street expected a rise of only 0.4%, given that the increase was 0.3% in March. The fact that the increase doubled is a sign that inflation is still a factor.

This increase in prices caused the stocks to end lower once more. The Dow Jones Industrial Average finished 1% lower, or over 300 points,the same day the report was released. The S&P 500 meanwhile fell 1.6%, and Nasdaq Composite fell by 3.2%.Some of the heaviest hits were felt in the Tech industry, with companies such as Netflix, Amazon, Apple, and Tesla falling by 3% or more due to the continued offload of shares by investors.

This data has worsened the state of the crypto market, as well as further eroded the confidence of its investors. Bitcoin’s price fell another 7% to reach around $29,000, its lowest point since the late 2020-early 2021 surge in price. Though it has since stabilized at around $30,000.

While food, shelter, and vehicle prices surged, gas prices fell around 6%, which helped counteract the overall increase and slow the rate of inflation. Experts believe that the peak of inflation has most likely been reached, but that the prices will continue to be above the Fed’s expectations during 2023. The chief economist of Comerica Bank, Bill Adams, stated that the slower inflation seen in April was most likely an effect of March’s gas price surge, itself owed to the Russia-Ukraine war.

This slow down of inflation, after a 40-year high, paints a slightly better picture after months of price increases. Still, April was the second-highest inflation level in four decades. The Federal Reserve set a 2% rate of inflation as its target, but experts expect that to rise to 5% or 6%, one of its highest points in history.

Chris Zaccarelli, chief investment officer of Independent Advisor Alliance, stated that the Fed would need to raise rates more quickly and to higher levels in order for things to stabilize. He predicted at least four 50 bps rate hikes during 2023. On May 10^th, one day before the report was revealed, United States President Joe Biden referred to inflation as his top domestic priority and the mainproblem that families are currently facing. This increased escalation in inflation is owed, in part, due to disruptions in supply chains caused by the worldwide COVID-19 pandemic.

D2C E-commerce Brands Struggle as Life with COVID19 Returns to Normal

Direct to consumer brands, which once were looked at as the future of commerce, are currently going down hard. Brands like Warby Parker, FIGS, Allbirds, Stitch Fix, Etsy, and Peloton are seeing their share prices decline massively. These companies seemed to have everything going for them, with promises of low overheads, global customer bases, and no middlemen, and yet their share prices have gone down by 60% in the past six months, and in some cases even more.

While their products are beloved and the brands well regarded in terms of quality, the confidence of investors has waned. This is mainly due to a combination of factors that has rocked the D2C industry as a whole. Due to the issues that the pandemic brought to supply channels, shipping costs have soared significantly. This coupled with higher Facebook ad prices, worse ad measurement, and smaller than expected audiences has dealt an almost crippling blow to the market.

On top of that, an analysis of public D2C companies with market caps of $800 million or more, made by Big Technology, found that almost all of them are struggling with shrinking margins and revenue, runaway losses, or a combination of them. In 2022, these companies have lost billions in market cap in a year that was already difficult for industries to begin with.

But out of all these, the rising Facebook ad prices seem to have been the most damaging factor. From the start, D2C companies have used social media and mainly Facebook as an affordable source for advertising. This was necessary for them due to their lack of physical spaces where a customer could walk in, using these ads to lure them to their virtual spaces instead.

At the time they went public, these companies had very limited brand awareness. Warby Parker, for instance, only had 13% brand awareness when it went public. Through Facebook, D2C companies could reach thousands of customers for just a few dollars.

But that’s not the case anymore. Rising demand has caused ad prices to triple within the past two years. Where reaching 1,000 customers could have cost around $6 in the past, the price could be as much as $18 now.

As previously mentioned, issues with the supply chain driving the rising cost of shipping is another critical problem. Due to the pandemic, the cost of importing containers from China increased dramatically, as much as 10 times in some cases. Given that these brands rely on shipping and imports for their operations, they have struggled to make up for that increased cost in their operations.

And yet another less mentioned but still important problem is the changes made to Apple’s iOS privacy settings and policies. iOS 14 privacy changes affected the ability of D2C brands to measure how well their social media ads are working, with internal metrics being off by as much as 40 to 50%. This severely limits how the companies can optimize their social media campaigns, which reduces their effectiveness. Coupled with the increased ad prices, they are paying more for less.

But D2C brands are not looking at this situation with crossed arms. Many companies, including Allbirds, have reached out to their investors to specify their plans to deal with these problems.

Allbirds specifically has shifted to grow its wholesale operations, opening three dozen physical stores, expanding its product categories, making new products, and establishing new partnerships. Tim Brown, Co-CEO and co-founder of the company, revealed to investors that their collaboration with Adidas saw them sell 90% of their inventory in three days. This shift to more physical selling has clearly worked, with retail channel sales going up by 129%. However, investors remain concerned given the current market.

Allbirds referred to “external headwinds” several times during their investor call and expressed that they would remain to apply a cautious outlook for 2022 until they could ascertain how these elements would play out.

While the brands have tried to work their way out, the numbers are not looking great. Allbirds, Warby Parker, Peloton, and Wayfair have posted significant losses or margin contraction over the last year. To give a concrete example, Wayfair went from $173 net income in 2020 to losing $78 million in 2021’s third quarter. In the same quarter, Warby Parker lost $91 million, though that’s in part due to stock compensation.

With interest rates rising, investors are warier of these companies. Furthermore, they have started to ask whether their valuations might be overblown, given that the market for their products doesn’t seem to be as large as projected. This has been reflected in the stock prices of these companies, with companies going down at least 19%. Some, like Allbirds and Warby Parker, have gone down significantly more with 64% and 40% decreases respectively.

And yet, the D2C space is not dead, far from it. Big brands like Nike are positioning their portfolios to take more advantage of these spaces. Furthermore, the rising prices of Facebook ads could be counteracted by moving to other platforms such as TikTok. And yet, seeing these public valuations in the billions contrast with such stark realities is not easy. Only time will tell how the D2C market fares.

Cash Vs. Credit Card Usage Statistics 2022

For the longest time, cash has been the reigning and most popular payment method for people all over the world, but this is rapidly changing. The adoption of cashless societies and virtual forms of payment is going up, an evolution that has probably been sped up by our experiences with the COVID-19 pandemic.

While cash is still fairly popular in the U.S., it’s quickly losing ground to debit cards and even credit cards. And there are a lot of interesting conclusions we can draw from the data surrounding the usage of these payment methods.

In this article, we’ll go over the statistics for credit, debit, and cash payments and general use, as well as discuss what we can glean from these numbers.

Credit Card Vs. Cash: Which Is More Popular?

Normally, cash reigns above all when it comes to popular forms of payment, but this is quickly changing. For the first time since the Diary of Consumer Payment Choice started to report in 2016, credit card payments surpassed cash payments during the year 2020. Cash payments went down 7% from 26% to 19% between 2019 and 2020, a decline which can most likely be attributed to the pandemic.

Credit card payments, on the other hand, rose from 24% to 27% of all payments within the same time period.

However, the most used form of payment was actually debit cards, with 28% of all payments made using this medium. Debit cards accounted for 10 of the 35 payments made on average every month.

It’s important to note that these numbers were affected by the pandemic in more ways than one. Not only was cash far more complicated to use during this time, but also only shopping rose due to the social distancing and isolation measures, and the number of payments made overall decreased.

Statistics for Credit, Debit, and Cash Payment Usage

Here’s some data regarding the use of debit cards, credit cards, cash, and their preference:

In general, 80% prefer to pay with cards over cash.
76% of all Americans have at least one card, and the average credit card holder has at least 3.
The average transaction with cash is $22, and without cash, it’s $112.
The average transaction with credit cards was $57.
Debit cards are used for 67% of card payments, and 28% of all payments.
Cash is more frequently used in low-income households, with 47% of all transactions being made with cash in households with less than $25,000 a year.
The total value of money spent went up from $4,236 to $4,760 in 2020.
Only 10% of people use only cash, but at least 88% of consumers use cash occasionally.
The average person held $74 in cash in their pockets, wallet, or purse during 2020 (up $20 from 2019)
The average person uses 3 to 4 payment methods each month, with more than 90% of households using more than one payment method.
52% of all active credit cards carried a balance during 2021, and as of the fourth quarter of that year credit card debt was standing at $856 billion.
Card payments are going up in frequency and quantity
In-person payments decreased by 7% from 87% to 80% between 2019 to 2020, while not-in-person payments went up from 13% to 20%.
Only 72% of people surveyed reported making an in-person payment within 3 days of the survey, down from 91% in 2019.
ATM withdrawals are going down in number, but the amount withdrawn each time is increasing.
45% of people prefer to store their card information online for future purchases.
38% of card users mentioned the reason they prefer cards is their convenience of use when compared to cash. However, 51% of them said that the high-interest rates of credit cards are a significant drawback.
Overall, people aged 65 and older account for the highest amount of cash usage, with 26% of them making their payments in cash. By contrast, people aged 25 to 34 only make 11% of their payments in cash.

What the Data Tell Us

There’s a lot we can infer and learn from the statistics seen in these reports. For starters, the pandemic has significantly changed our relationship with money and the way we make our payments

While in-person and cash payments have historically been preferred, virtual payments and payments made with cards went up significantly during 2020. However, given that this was the result of strict social distancing and isolation measures driven by efforts to mitigate the effects of the pandemic, it remains to be seen if this will result in long-term change.

But even if that hadn’t been the case, the truth is that cash has been going down in recent years in favor of debit card and credit card payments.

Cash was behind debit and credit cards for all age groups except those aged 65 and older, with younger generations preferring to use debit cards.

In general, debit cards seem to be replacing physical cash as the preferred form of payment. According to the report, people that prefer cash used their debit cards as backup twice as much as they used their credit cards.

Cash in general seems to be preferred for smaller transactions, with the majority of payments under $10 being in cash. For payments between $10 and $100, credit cards and debit cards make up about 60% of the payment share.

And while the number of payments went down overall, their average transaction size increased significantly. The average person spent $326 during October of 2020 in non-bill payments, up from $265 in 2019.

Final Thoughts

Credit card and debit card spending is going up, and cash is on its way down. This is not surprising given the recent economic turmoil, the challenges presented by the pandemic, and the increased popularity of online shopping.

However, it remains to be seen if the changes will stick, as one of the main factors for the switch in popularity from cash and in-person payments to cards and virtual payments was the pandemic.

Terra LUNA Crash – A Nightmare for Crypto Investors

Why Terra LUNA is going Down?

Will Terra LUNA Recover?

These are the two most common questions people are talking about in the crypto community. It’s not the first time that a cryptocurrency has crashed so badly. But Luna’s case is a bit different.

Luna Was Supposed to Be a Fundamentally Strong Project

Crypto is an unregulated market where the risks of scams are too high. Over the years, many inexperienced investors have lost millions of dollars by investing in different crypto projects without knowing any details.

Luna, on the other hand, had a community of experienced investors who invest their money after some research. A week ago LUNA was ranked among the top 10 cryptocurrencies in terms of market cap. But now, it has collapsed and it’s not even worth a penny anymore.

The investors have lost billions of dollars within a few days and some anecdotal reports of self-harm are reported because people had invested their life savings in this project. Some people claim that it was an organized scam planned over a long time while others believe that the company itself got scammed by a group of people.

How did Terra Luna Work?

Terra introduced the concept of algorithmic stablecoins where the value of a coin is kept constant through another crypto token and smart contracts. TerraUSD (UST) was the stablecoin of Terra that was pegged at $1. The value of UST was maintained by burning LUNA tokens.

Other stablecoins like USDT, BUSD, and DAI are backed by physical assets that can be used as collateral. But UST was a more decentralized solution as it was backed by another cryptocurrency called LUNA.

The price of UST was pegged at $1. So, the arbitrageurs helped with maintaining the value. The arbitrageurs used to buy the UST tokens whenever its price dropped below $1. And they used to convert their UST tokens into LUNA tokens whenever the UST’s price raised above $1.

So, if the UST’s price is at $1, the arbitrageur needs to burn $100 worth of LUNA tokens to mint 100 UST tokens but if the UST’s price is at $0.98, the arbitrageur can get 100 UST tokens by burning $98 worth of LUNA tokens. And they can convert the UST into LUNA once the UST’s price is at $1.

Thus, they can generate a $2 profit from this trade. And the profit may increase depending on the size of the trade. Similarly, the arbitrageurs could mint LUNA tokens by burning UST if the UST’s price is above $1.

We invite you to read our detailed guide about Terra LUNA if you need more information about how Terra Luna Worked.

How Terra Luna Became Popular?

Introducing an algorithmic stablecoin was a major reason why Terra became popular. It enabled users to transfer funds globally with a very reasonable fee. It worked as a bridge between fiat currencies and cryptocurrencies allowing users to buy/sell cryptocurrencies smoothly.

Furthermore, it was the second most popular smart contract building platform after Ethereum. The users could generate smart contracts on this platform by burning Luna Tokens. Similarly, the developers could build apps and other tokens on this network.

Why did Terra LUNA Token Crash?

UST had a total market cap of $15-16 billion before it all began. At the beginning of the week, around $2 billion worth of UST tokens were unstaked from the network and they were immediately sold in the market due to which the UST was depegged and its price dropped $0.90-$0.91 cent.

The arbitrageurs started taking advantage of the opportunity by converting their UST tokens into Luna to generate some profits. It ultimately created panic leading to a mass selling of UST tokens. The problem is that the users could only burn $100 million worth of UST for Luna tokens per day.

So, the holders started exchanging UST for other stablecoins because there wasn’t any other solution. The company started selling its reserve of Bitcoin to stabilize the UST token but it couldn’t support the sell-off. The Luna token holders also panicked when they saw such a huge decline in the price of the stablecoin.

The organization also minted a huge amount of LUNA tokens to protect the value of their Stablecoin (UST). But it didn’t work and created a gap between supply and demand due to which the price of LUNA token declined even further. And the Luna token that was trading at $85 at the beginning of the week is not even worth a penny anymore.

Who Caused the Terra LUNA Token Crash?

Some people claim that a group of people intentionally played this trick to manipulate the price of Bitcoin. Terra organization had a huge amount of Bitcoin reserves that they intended to use to stabilize the UST token. The manipulators knew that the organization will sell its Bitcoin reserves to tackle the huge sell-off. But these are just claims and there isn’t any solid evidence.

However, it’s one of the major reasons why Bitcoin’s price declined during this week.

When will LUNA Recover?

Do Kwon, the founder of Terra Foundation, has announced that they’re working on fixing this issue and they’ve requested the holders to be patient. But the miners have agreed upon halting the operations of the Terra network to prevent the governance attacks. The withdrawal requests are also stopped by several exchanges to handle this situation.

According to the current situation, the Luna token may take some time to recover.

Conclusion

LUNA token was one of the top 10 cryptocurrencies almost a week ago but it’s not even worth a penny anymore. It was best known for its algorithmic stablecoin UST (TerraUSD). But the stablecoin has also lost its value in the current situation. The Terra Organization is trying to resolve the problem. So, many investors are still hopeful that it may recover over time.

But at the same time, it’s quite alarming for those who have invested in other crypto projects.

US Credit Card Usage and Credit Card Debt Statistics in 2022

Credit cards are designed to get us to spend as much as we want. With an easy “swipe now, worry later” approach, your credit card debt can easily get out of hand if you don’t keep track of your spending. And apparently, that’s what happened to the American people in these last few years.

In 2022, the total credit card debt of Americans is humongous, but what is the full picture?

In this article, we’ll go over the credit card statistics for debt, usage, and more for the last two quarters of 2021 and the beginning of 2022. We’ll take a look at how much is owed, how many accounts carry a balance, and other interesting credit card debt statistics.

How Much Credit Card Debt Is Owed by Americans?

According to a report released by the Federal Reserve Bank of New York, the total balance for credit card debt ascended to $856 billion in the final quarter of 2021. That’s a stunning number on its own, but its impact is made more apparent when compared to the third quarter, where the debt was at $804 billion. That means that in the span of about 3 months, credit card debt rose by $52 billion.

That’s the largest increase seen between quarters in the entire 22-year history of the report, as well as the third quarter in a row that the debt has increased. Overall, 2021 saw the largest increase in nominal debt since 2007.

The results are not unsurprising considering this comes a year after the pandemic, but they are still worrying. However, the debt is actually lower than its historical highest point, which was $927 billion during the fourth quarter of 2019.

Given the recent economic downturn, it’s likely that the first quarter of 2022 sees even higher numbers.

How Many Accounts Carry a Balance?

52% of all active credit card accounts carried a balance during the third quarter of 2021, according to a report from the American Bankers Association. If we take a look at all accounts, active or not, the number falls to 40% for the same time period. 36% of the active accounts didn’t carry a balance, and 24% were considered dormant.

The data paints a troublesome scenario. With credit cards, the goal is to pay the balance in full every month to avoid the high-interest rates and fees. However, understandably not everyone is able to do so every time.

Still, the fact that more than half of the active accounts are currently failing to meet that goal means that most people are currently unable to pay their bills in full. And with credit cards, that just means creating a cycle of debt that only deepens due to the interest rates.

And yet, only a tiny fraction of all the credit cards have delinquent balances of at least 30 days. Only 1.62% of all accounts have balances that are at least 30 days old. That’s slightly higher than the number seen in April of 2021, when it was just 1.54%. While the percentage increase, numbers are still lower than they have ever been since the reporting started, and far off from the 7% seen during 2009.

What’s the Average Interest Rate?

For the first quarter of 2022, the average APR of all credit cards was 14.56%, which was slightly higher than the 14.51% seen during the fourth quarter of 2021. For credit cards that accrued interest, the average APR was 16.17% during 2022, which was lower than the 17.13% and 16.44 seen during the third and fourth quarters of 2021.

The 17.13% average seen during Q3 2021 was the second-highest average reported by the Federal Reserve since 1994.

However, for new credit card offers the APR is a lot higher, sitting at 19.68% on average. Credit card offerings currently have a variable APR range of 16.11% to 23.25%, depending on several factors such as your credit and account standing. Given the announcement from the Federal Reserve of a rise in interest rates, expect your credit card’s APR to rise in the coming months.

How Is the Credit Card Usage Divided Among Lenders?

According to data gathered by Nilson Report in 2022, the volume of all purchases made during 2021 with credit cards from the top seven lenders was divided in the following way:

Chase Bank: $950 billion
American Express: $868 billion
Citi Bank: $483 billion
Capital One Bank: $455 billion
Bank of America: $414 billion
Discover: $182 billion
U.S. Bank: $166 billion

The total purchase volume generated by them was $3.517 trillion, up 25.6% from the previous year.

Interesting Credit Card Debt Statistics

There are a lot of interesting numbers to see in the latest reports from the Federal Reserve and Credit Card lenders. Here are some statistics on credit card use in the United States:

The average American has 3 credit cards, and 83% of all adults have at least one card.
There are 531.540 million credit cards in the U.S.
When divided by race, the amount of adults that have credit cards is 87% for White Americans, 92% for Asian Americans, 72% for African Americans, and 76% for Hispanic Americans
The baby boomer generation has the highest average number of cards at 5, while Gen Z has the lowest at 1.7.
People with incomes lower than $100,000 are more likely to carry a balance from month to month.
The average debt is $8,590 per household as of the fourth quarter of 2021.
The average minimum payment due for the average credit card monthly bill is $110.50.
The average debt of Americans within the 90^th to 100^th annual income percentile was $12,600
Credit card debt was the most common type of debt during 2019, with more than 45% of families reporting debt after their last payment.
The use of credit cards for payments increased from 24% to 27% between 2019 and 2020.
Alaska has the highest overall credit card balances, which are 30.9% higher than the average, while Iowa has the lowest balances at 17% lower than average.
Gen Z is reported to be turned down twice as much as any other generation when applying for their first credit card twice, with 27% saying they were rejected upon application.

Final Thoughts

While lower than its 2019 historical record, credit card debt is still overall at a very high point. On top of that, more than half of the Americans with active cards are currently unable to pay off their full balances each month.

Given the hikes in interest rates and the general economic situation we are experiencing, these numbers are likely to increase. However, there is a silver lining. In general, delinquency is at one of its lowest points since credit card debt reporting started.

Apple Announced Tap to Pay on iPhone

Apple has recently announced its plans to launch the all-new ‘Tap to Pay’ feature on the iPhone platform. The revolutionary ‘Tap to Pay’ feature for iPhone will be helpful in turning the device into a contactless terminal for accepting payments.

As per the reports of Apple, during the later part of year, the merchants in the United States will be capable of accepting Apple Pay along with other contactless forms of payments. This feature will include Google Pay acceptance as well. All such contactless payments will be accepted with the help of iPhone and a third-party partner iOS app.

Understanding the ‘Tap to Pay’ Feature

The Tap to Pay feature will be enabled for relatively recent iPhone models like iPhone XS and later. Tap to Pay on iPhone devices will be made available to app developers and payment platforms to integrate into iOS apps as a leading payment option. For instance, Stripe will be one of the first payment platforms that will offer Tap to Pay on iOS devices to its customers with the help of the all-new Shopify app. Apple adds that additional payment applications and platforms will also follow at a later point in the year.

Once the functionality of Tap to Pay has been launched, merchants will be capable of unlocking the capability of contactless payment acceptance with supporting iOS applications. During the checkout process, merchants will ask customers to hold their Apple Watch or iPhone near the iPhone of the merchant. The payment will then be completed in a secure fashion with the help of the NFC technology. The best part is that there is no requirement for any additional hardware to accept contactless payments.

Apple also revealed that with the Tap to Pay on iPhone, payment data for customers remains protected throughout. All transactions in the process are made with the help of secure encryption.

Apple and Tap to Pay Feature

The tech giant revealed that Apple Pay has already been accepted by over 90 percent of retailers across the United States. As such, the all-new capability of the Tap to Pay feature by Apple will enable customers to experience seamless check-out processes. Tap to Pay on iPhone will also be rolling out on subsequent locations of the Apple Store in the United States at a later date in 2022. Apple plans of working closely with app developers and payment platforms to release the Tap to Pay solution on iPhone to merchants across the country. Tap to Pay by Apple will work in collaboration with contactless debit cards and credit cards from different payment networks – including Visa, MasterCard, Discover, and American Express.

Jennifer Bailey, Vice President at Apple for Apple Pay & Apple Wallet, said in a statement that as more consumers continue tapping to make payments with credit cards and digital wallets, the feature of Tap to Pay on iPhone will offer businesses a private, easy, and secure way to accept contactless payments. It will also help the customer experience with the overall convenience, security, and power of the iPhone. Apple adds that Tap to Pay feature will be made available only to participating payment platforms. It will also be available for app developers and partners in the upcoming iOS software beta.

Understanding the Working of Apple Tap to Pay

Apple Tap to Pay will enable users to make use of mobile phones as secure payment terminals. It is believed that the acquisition of the startup Mobeewave is the foundation for the all-new technology.

The feature will support payments from Apple Pay, contactless debit & credit cards, and subsequent digital wallets. Previously businesses that accepted contactless payments on iPhone were expected to use third-party hardware like Square Reader dongle.

Currently, the feature of Tap to Pay on iPhone will be limited to merchants and businesses that would like to accept contactless payments with the help of supported iOS apps on iPhone XS and later models. Apple has stated that all merchants will require iPhones to accept as well as process payments.

Businesses Supporting Tap to Pay on iPhone

Stripe announced that it will be the first company to offer the Tap to Pay functionality on iPhone to business customers. It will also include the Shopify POS or Point of Sale app during spring 2022.

In April 2022, Adyen, a leading Dutch payment processing firm, was also added to the compatible list. Additional payment apps and platforms will be following in the coming year as per the reports from Apple. Apple Stores in the United States will also be rolling out the feature very soon.

Tap to Pay by Apple will be introduced in the United States later on in the 2022. It will be an exclusive feature to the US at launch. There has been no announcement made regarding any other country. While the feature of Tap to Pay is not available for immediate use, the supporting API will be made available in iOS 15.4 to enable the feature on the iPhone XS models and later.

Robinhood Adds Support for Four New Crypto Assets Including Shiba Inu

Robinhood has had a massive effect on the crypto market. This financial service company’s recent wallet release is going have a potentially profound impact on the ramp up of the market. In August of last year, Robinhood reported that 62% of their revenue was being driven out of Doge Coin. This is amazing since crypto made up 50% of the revenue which was transaction based in the second quarter. This was a jump up from 17% in the first quarter.

Robinhood Expands Crypto Features on Trading App

Robinhood’s investment into new tokens was partly due to the expansion of the crypto trading capabilities of their application. The four coins that Robinhood invested in include Solana (SOL), Compound (COMP), Polygon (MATIC) and Shiba Inu (SHIB).

COMP

Compound is a protocol that uses an algorithm to run interest rates autonomously. Developers created this protocol so that people had access to an open source financial application. Compound allows users to deposit their digital assets into a lending pool and then earn interest out of the deposit they have lent. In this, holders of the crypto asset can take a vote to change the protocol. This Ethereum-based governance token stands at a supply of 10 million.

MATIC

This is a decentralized block chain that operates as a side layer to Ethereum and leverage from Ethereum’s security. MATIC is a native token of the Polygon network, and processes multiple thousand transactions on its blockchain.

SOLANA

This is another proof of stake blockchian that is created to enable many Crypto-based functions. It has no total supply and it is integral to many DApps, exchanges, protocols and projects in the crypto space. It leads in the top five charts in terms of market cap, making it one of the most popular alt coin.

SHIB

Shiba Inu is an ethereum based coin that resides on its blockchain. It was launched as a meme coin following the popularity of Doge Coin in August 2020. The creator of this project remains anonymous and the current founders claim that it was just an experiment for decentralized community building. After gaining popularity and acknowledgment by celebrities, Shiba Inu is starting to make collaborations to form new use cases.

After the announcements of the investment, each of the coins saw a significant jump in valuation. Now, users of Robinhood can easily purchase the coins on the application. This is going to be very interesting. However, many people are confused over the timing of their listing.

Users also do not need a crypto wallet to purchase SHIB tokens on the Robinhood app. This listing was very random and not many people had anticipated it. There was no buildup before any of these investments had been made and the sudden purchase has many people guessing.

Moreover, the company is utilizing the lightning network to conduct Bitcoin Transactions, and this goes back to scenarios that were announced at Bitcoin 2022. Many things are starting to revolve around payment transactions and the platforms that could potentially be employed on.

Robinhood came in and layered in the lightning network built on top of Bitcoin. By doing so, it has become a part of the tech companies that use the lightning network. As they go into the wallet aspect on the use of Bitcoin, it will lean into a good future towards where Robinhood is going.

RobinHood’s Future

Experts are also hinting Robinhood to becoming a much more active crypto currency exchange. They are seeing the future and movement of the asset classes, along with a yound economy around Robinhood. This is why it is very possible if the acquisition of tokens will drift towards this platform.

On another aspect, Robinhood’s crypto wallet opened up to a total of two million people. Several people in the crypto pit were able to get their hands on the wallet so that they could move the tokens fairly quickly. The biggest challenges of getting into the exchanges and being able to move outside and do some of the complex trades is usually the settlement timeframe between the bank and the exchange.

In this instance, having Robinhood as a fiat on ramp has been very helpful for many traders that are starting to utilize robinhood with the new application and aspect of the wallet. Opening up to 2 million users was therefore an interesting move by the company.

Interesting and Noticeable Features

Robinhood’s pricing is in many cases much better on some of the tokens. Users are able to get a better position on this platform than some of the other major platforms. Something to watch here is that Bitcoin is a recurring investment and this starts to push the aspect of where robinhood may be going in terms of a crypto exchange.

The one downside of this is the platforms lack of NFT capacity. Another big play for the platform would include them rolling out NFT wallet for the users. In a poll, users were most bullish about Shiba Inu amongst the four tokens that Robinhood invested in. As soon as they announced SHIB investment, there was a big movement of about 22% in its price.

Shiba Inu Price News

The Robinhood listing is acting as the catalyst for making the price of this coin rise. As Robinhood enabled SHIB purchases, the Etherum whales are starting to gobble up as many Shibs as possible. They have increased their activity in accumulating this coin. Two whales are leading this collection, and these purchases are making it difficult for small investors to gauge the market.

Final Words

Robinhood’s jump towards the Crypto assets only goes to show that mainstream payment systems are slowly started to adopt alternative methods of financing. Not only that, it also shows the rapid acceptance of digitized transactions. Shiba Inu and the four coins may be the start to a complete transformation towards crypto assets for Robinhood.