As regular readers may know, card issuers are currently falling over each other in their rush to improve their credit card offers. In fact, it’s getting tough to keep up with all the enhancements. So here’s the first in an occasional series of news blogs that is going to try to make sure that you don’t miss anything that could be of value to you.

Cash back credit cards: a bonus from American Express

First up is American Express, who is offering a one-off $25 statement credit if you spend $25 or more at a participating small business on this year’s Small Business Saturday, which is Nov. 26. But first you must register your U.S. American Express® Consumer Card or Business Card by clicking on the link at www.facebook.com/shopsmall and following the directions.

This has to be good on so many levels. For you, it could mean (if you shop really carefully) 100 percent cash back on a purchase. But also, it’s a great way of giving the struggling small business sector a much-needed shot in the arm.

Chase boosts rewards and perks for military

In other welcome news, Chase announced last week that it was improving the deals it offers to “our men and women in uniform around the globe.” According to the press release, the move affects those holding:

• Chase Military Star Rewards MasterCard
• Air Force Club MasterCard
• Army Morale, Welfare, Recreation (MWR) MasterCard
• Navy MWR MasterCard
• Marine Corps Community Service MasterCard

From now on, those with these cash back credit cards, none of which have annual fees, should receive unlimited rewards on all their purchases, and foreign transaction fees are going to be scrapped, something that should prove especially valuable to those serving overseas. Cardholders get 2 percent cash back on purchases at Army MWR, Air Force Services and MCCS Merchant outlets, and 1 percent on everything else. ,” said Emelie Smith Calbick, a general manager of Chase Card Services, commented in a press release:

Chase is proud to support our men and women in uniform around the globe. Service members and their families deserve financial resources that fit their unique needs – whether they are on-base, have been deployed or are anywhere in between.

As reported in CardRatings.com, according to Steve O’Halloran, spokesman for Chase Card Services, the Chase Military MasterCard is also included in the promotion, although the press release did not mention it. Chase’s USNA Alumni Association MasterCard is not part of the promotion, but it no longer includes a foreign transaction fee.

Visa small business credit cards

Meanwhile, also last week, Visa unveiled improvements to its “Visa SavingsEdge” program for those with small business credit cards that carry its brand. According to Visa, there are currently 24 million such cards in the US, but you have to register yours (it’s free at www.visasavingsedge.com/offers) before you can enjoy benefits.

After enrollment, you can get discounts at a large number of participating merchants that offer products and services that are likely to appeal to small businesses, including:

• Advance Auto Parts
• Barnes & Noble
• Health Advocate
• HyperOffice
• iContact
• La Quinta Inns & Suites
• Red Robin
• Sears PartsDirect
• Support.com

We’d love to report on some juicy behind-the-scenes goings-on at one of the major credit card issuers, but that’s going to have to wait for another day. Because today’s top story involves two recent improvements to rewards credit cards – one from Chase and the other from Discover – that deserve attention.

Chase turns rewards credit cards into travel rewards cards

Let’s start with Chase, which has managed a form of plastic alchemy by turning three of its ordinary rewards credit cards into travel rewards cards. Well, sort of. To be more accurate, it’s added the ability to transfer points from its Ultimate Rewards program to United Airlines MileagePlus accounts. The products affected are:

1. Chase Sapphire Preferred
2. Chase Ink Plus
3. Chase Ink Bold with Ultimate Rewards

You get one MileagePlus point for each Ultimate Rewards point, and the former can be redeemed on flights on United Airlines or any other members of the Star Alliance network. Chase says there are no limits to the number of points you can transfer, and claims that this is currently unique among credit card rewards programs. The card issuer’s Sean O’Reilly commented in a press release:

We are thrilled to offer our customers the exclusive opportunity to transfer Ultimate Rewards points for equal award miles with MileagePlus, the world’s leading frequent flyer program. The addition of MileagePlus to Ultimate Rewards enables our cardmembers to simply transfer points and have more travel options than ever before.

Discover Amazon’s treasures

No, Discover isn’t rewarding cardholders with trips to the Amazon river. It’s making it easier to pay for books and other goods on the Amazon website.

As of now, holders of Discover cash back credit cards, such as the Discover More Card, can use their rewards to partly or fully pay for purchases they make on Amazon with their Discover rewards, providing they first link their plastic with their Amazon.com account. If you part pay, you have to charge the balance to your Discover card.

There’s one more piece of good news for the holiday season. If you pay on Amazon using Discover cash back credit cards between now and the end of this year, you should earn double rewards.

Both Discover and Amazon commented in a press release… But no. Theirs were even more banal than Chase’s, so, as a public service, you’ll be spared them. Suffice it to say, Discover is very pleased with their new arrangement with Amazon and hopes you will be too.

It’s been a recurring theme in this blog lately: credit card companies are upping their game as they compete for market share, and consumers have benefited through more generous rewards and improved perks. But it’s not just consumers who are getting better value from their plastic. Businesses too have often found they can get more from their cards. So it was no surprise on Wednesday when American Express and MasterCard each announced significant enhancements to some of their business credit cards.

American Express: email in the air for free

First up, the American Express® Corporate Platinum Card, which is now offering two perks that could have real value for international travelers, and frequent fliers in general.

One of the worst aspects of flying overseas is coming home. No, not being reunited with the family, but having to join those all-too-often very long queues at passport control. U.S. Customs and Border Protection has now recognized just how irritating these long lines can be, and has introduced Global Entry, a program that allows low-risk, pre-approved Americans to avoid most of these delays via a streamlined process. The bad news: there’s a $100 application fee before you can register. The good news: American Express is offering to pick up the tab for those with its Corporate Platinum Card.

Another new perk for holders of that card is free Gogo in-air wi-fi on up to 10 flights a year within the continental U.S.A. You have to buy a Gogo flight pass using your card, but will receive a statement credit for the full cost. The operators of the currently 1,200 airplanes equipped with this service include:

• Air Canada
• AirTran Airways
• Alaska Airlines
• American Airlines
• Delta Air Lines
• Frontier Airlines
• United Airlines
• US Airways
• Virgin America Airlines

American Express senior vice president Jaromir Divilek explained in a press release the thinking behind these innovations:

Business travelers have no time to waste. They’re on the go 24/7, and are constantly looking for ways to save time and be more efficient. These new benefits will ease their time on the road, and, at the same time, benefit the corporation by encouraging card usage and aiding expense management across the organization.

MasterCard: more affordable hotel accommodation

Meanwhile, those who register their eligible small business credit cards with the MasterCard Easy Savings Hotel Network can automatically save 4 percent on “all hotel folio charges” when they pay with that card at over 7,500 mid-scale and economy hotels across the country. Participating chains include:

• Days Inn
• EconoLodge
• Hampton Inn
• Hilton Garden Inn
• Holiday Inn
• Holiday Inn Express
• Howard Johnson
• Hyatt Place
• Ramada
• Super 8

These hotel discounts are an extension of the MasterCard Easy Savings Program, which already offers enrolled small businesses various discounts. Two new ones of these are 10 percent off both cloud-based phone systems from Vocalocity, and tax and financial advice from BIDaWIZ. MasterCard Worldwide vice president Eugene DeSilva commented in a press release:

The expansion of our popular Easy Savings program helps MasterCard deliver on our commitment to help small businesses find easy, stress-free ways to maximize the success of their business and get the most out of every dollar. And, the financial institutions and merchants that issue and accept our cards benefit from creating stronger, more rewarding relationships with their customers.

As small business credit card offers go, that sounds a good one.

As people up and down the eastern seaboard continue to clear up in the wake of Hurricane Irene, many are likely to be looking to their credit cards to help pay for repairs and the replacement of wrecked household goods. It’s depressing work, and especially distressing for those who are uninsured, either completely or just for flood damage. Business Insider recently quoted one source that suggested that up to 95 percent of all affected homeowners fall into this group.

Low interest credit cards versus rewards credit cards

Wow! That’s a colossal and genuinely shocking figure. And it suggests that huge numbers of victims may be forced to fall back on their plastic just to restore their lives to something approaching normalcy.

If you’re one of them, you’re likely to be pretty short on silver linings at the moment, and might be attracted by even the minor one offered by rewards credit cards. While you’re spending all that money, you may think, you might just as well get some cash back, travel miles, points or whatever.

Good idea. But it may not be the smartest move for all your purchases. For many of those, you should probably be pulling your low interest credit cards from your wallet instead.

Credit card rates, rewards credit cards and credit card calculators

That’s because, on average, interest rates are higher for rewards credit cards than those for ordinary ones. Indeed, at the time of writing, IndexCreditCard.com’s credit card rates monitor says that the average annual percentage rate (APR) for consumer non-rewards cards is 14.72 percent, while that for consumer rewards cards is 17.30 percent.

You’d need a spectacularly generous rewards card for it to make sense for you to charge items to it that you know you won’t be able to pay down for a long time. Generally speaking, the rule is that it’s good to use rewards credit cards for purchases that you know you can clear quickly, and low interest credit cards for those that are going to take you longer.

You can use credit card calculators to see how long it should take you–and how much it should cost you–to pay down balances at your own cards’ different interest rates. Then you can work out what your personal strategy should be.

Balance transfer credit cards

If your credit’s good and you’re having to load your cards a lot post-Irene, then you might want to consider applying for a balance transfer credit card. There are two reasons why this could be a good idea:

1. A number of these–mostly from Citi–offer zero percent APR on transferred balances for 21 months. Others make a similar offer for 15 months. That could provide you with just the breather that you need to get over the hurricane.
2. Your credit score could suffer if the balance on any of your cards is higher than 30 percent of its credit limit. So even if you can manage paying down your credit card debt easily, you could be better off spreading the load across more plastic.

Credit card companies human!

One tiny positive revelation that emerged in the aftermath of Irene is that credit card companies are human. That’s not necessarily in the sense that the U.S. Supreme Court thinks, namely that corporations are people. No, it’s in the sense that they’re run by real-life, breathing and occasionally sentient human beings. Many of them announced that those affected by the hurricane could see their late payment and/or other penalty fees waived, though only for a strictly limited time. Awww. Ain’t they sweet?

You probably won’t like it, but next month sees the implementation of the Federal Reserve’s new regulations concerning “swipe” (also known as “interchange”) fees. These fees are the cut of each transaction value that a merchant has to pay to your bank or credit card company every time a debit or credit card is swiped in their store. The Fed’s new rule imposes a cap on the amount that banks get when you use a debit card. And, as a result, many banks are scaling back their debit card rewards programs, and imposing fees on checking accounts and/or debit card use to make up the lost income.

The great debate over swipe fees

On Friday, The Augusta Chronicle quoted David Oliver, a spokesperson for Georgia Bankers Association, as saying: “As a result of the Dodd-Frank Act, the cost of debit card payment services has shifted from retailers and merchants to consumers.”

And that’s certainly one valid way of looking at it. Another is that few merchants ever shouldered the burden of swipe fees themselves, but instead raised prices to cover them. And those higher prices were paid by all customers–including poor, unbanked ones who use cash. Looked at that way, you could see such fees as a sort of private-sector sales tax by which the poor subsidized better-off people’s free banking and rewards programs.

Which view is correct? You pays yer money and you takes yer choice, though you’d probably be better off using a credit card when you do so.

Credit cards are better

That’s because, generally speaking, credit cards have always been the best way to pay for purchases. Toward the end of last year, this credit card news blog identified 7 ways in which credit cards beat debit cards, and three of those were:

1. Better statutory protections if you’re a victim of fraud
2. Better statutory protections if you need to dispute transactions because of shoddy, misdescribed or undelivered goods or services
3. Better benefits from rewards credit cards

As banks scale back or abolish debit card rewards, that last point is likely to become even more significant. That’s because rewards credit cards (indeed, all credit cards) are exempt from the Dodd-Frank Act’s provisions, so there’s no reason why they shouldn’t remain as generous as ever.

Rewards credit cards improving

Indeed, as this blog recently pointed out, the rewards on offer from many credit card companies are actually getting better. In particular, recently launched cash back credit cards and travel rewards cards often offer superior benefits compared with older ones.

Among the new cash back credit cards now available are the Capital One Cash card, and BankAmericard Cash Rewards™ card. Recently launched travel rewards cards include the Citi Executive^SM / AAdvantage^® World Elite^TM MasterCard^®, and the United MileagePlus^® Explorer Card from Chase.

Ashton Kutcher, star of “Two and a Half Men” and a number of movies, sang at yesterday’s Teen Choice Awards ceremony, where he picked up a mantelpiece ornament for his performance in “No Strings Attached.” And, somewhat unexpectedly, he also offered some sage advice to his young audience.

“Here’s the best piece of advice I got when I was a teenager,” Kutcher said. “Don’t ever charge anything on a credit card if you don’t already have the money in the bank to pay for it.”

Gather.com, a news blog, reports that Kutcher followed up his remark in a tweet: “Thank you all for the award and the love! And I’m serious about thy [sic] credit card thing. #tca.”

Credit card debt and the young

Kutcher is married to Demi Moore, and it seems likely that between the two of them they have money in the bank to pay for pretty much anything that they feel like charging to their credit cards. And he must be aware that a multimillionaire preaching to the less fortunate about financial responsibility could be taken as “let them eat cake.” But that just makes his statement more brave. Because his was a message that needed saying.

Some weeks ago, IndexCreditCards.com explored (see “I owe, therefore I am” say many young adults) the shocking results of a serious academic study that found “a significant number of young adults–and especially those who came from poorer backgrounds–reported that the higher the amount they owed in education and credit card debt, the better they felt about themselves.”

Credit card regulation and rates

However, it’s not just Kutcher’s teenage audience who could benefit from following his advice. On Friday morning, this blog warned of the new dangers faced by everyone who has serious credit card debt (When the sky is falling, pay down credit card debt).

At the time, the biggest threat appeared to be from falling markets, which might have triggered–and still might trigger–the second phase of a double-dip recession.

Later that day, Standard & Poor’s downgraded America’s credit rating, a move that not only could make that threat greater, but that also could bring about a rapid rise in credit card rates. Yesterday’s Washington Post put it this way:

The interest rate the United States pays on its short-term loans is determined by the market for Treasury bills. The downgrade could increase the yields on those bonds, forcing the government to spend more to borrow the same amount of money. Many consumer loans, such as credit cards and mortgages, are linked to the yield on Treasuries and therefore would also rise.

The good news is that credit card regulation, in the form of the Credit CARD Act of 2009, prevents card issuers from increasing rates on existing balances except in rare circumstances, and new rates should generally apply only to new purchases.

Keep credit card use in check

However, you’d be brave–borderline foolish–to see this as an opportunity to make purchases now in an attempt to lock in low credit card rates. Yesterday’s New York Times warned:

If the economy falls back into recession, as many economists are now warning, the bloodletting could be a lot more painful than the last time around. Given the tumult of the Great Recession, this may be hard to believe. But the economy is much weaker than it was at the outset of the last recession… with most major measures of economic health… worse today than they were back then.

And that means that you might find yourself either struggling to keep up payments on your plastic, or in desperate need of as long a line of credit as you can get. Either way, you could regret ignoring Kutcher’s advice.

On July 14, this credit card news blog reported on rumors that HSBC was planning either to sell its US credit card business or to close it down (see Rumors of HSBC’s demise may be greatly exaggerated). This writer had conducted a telephone interview with Rob Sherman, HSBC North America’s vice-president for public affairs, who had said:

The card business is under strategic review. We haven’t said any more than that, so it’s jumping to conclusions to say that we’re going to sell or close. We are evaluating a number of options… to determine the long-term future of the card business within HSBC.

Credit cards from HSBC could be at risk

Although Sherman’s carefully measured comments were undoubtedly true, IndexCreditCards.com warned at the time that HSBC’s chairman had earlier in the year announced a new direction for the global business. This could see the bank “divesting itself of assets (such as its U.S. credit card operations) that aren’t essential to the new strategy in order to fund acquisitions that are.”

The likelihood of HSBC selling or shuttering those operations grew earlier today when the bank unveiled a $1 billion deal to sell 195 branches in its New York and Connecticut network. Bloomberg reports that a further 13 HSBC branches in Connecticut and New Jersey are due to be closed by next year.

This morning, The Guardian (a newspaper that, like the bank itself, is based in London, England) suggested that HSBC has earmarked its retail businesses in 20 countries (out of the 87 nations in which it operates) for sale or closure. The report went on to call the North American operation “troubled,” and said that it was “the smallest generator of profit” for the entire group. So the chances of HSBC moving out of this market seem high.

Credit cards under many brand names threatened

What might this mean for holders of HSBC credit cards, which, besides those under the HSBC Premier name, include some or all of those branded Orchard Bank, GM, Sachs, Best Buy and Neiman Marcus, among others? Well, a sale could mean very little change indeed.

But closure could see cardholders losing their cards and therefore access to new credit. However, repayments of any then-existing credit card debt would likely remain in line with current card agreements.

Time to make a credit card application?

Existing users of all these branded cards may well be feeling nervous by now. To be fair to HSBC, there is a good chance that it would be able to sell its U.S. operations. At the moment, credit card companies generally are highly profitable, and it seems likely that one of them would pay a fair price to get its hands on this extra market share.

However, there remains a real possibility of closure, and this could eventually leave holders of the bank’s many cards high and dry. If you’re one of them, you may well wish to start shopping around for new plastic now. But before you complete a credit card application, be sure to read 5 ways to pick the best plastic first.

Today, the Consumer Financial Protection Bureau (CFPB) comes fully into existence. And already it is inviting you to file your complaints about credit cards and credit card companies on its website. Let’s hope it isn’t swamped. But even if it isn’t, many are fighting to make sure the regulator won’t be as effective as was originally envisioned.

Credit card complaints

The “File a credit card complaint” section of the CFPB’s website looks fairly straightforward and user-friendly. It’s broken down into five stages:

1. What happened?
2. Desired resolution
3. My information
4. Credit card information
5. Review

And the bureau promises: “We’ll forward your issue to your credit card company, give you a tracking number, and keep you updated on the status of your complaint.” It remains to be seen how much more useful this process is going to be than simply complaining to credit card companies directly. However, if enough complaints about a particular card issuer or problem are received, that could presumably trigger a wider CFPB investigation.

Credit card regulation becomes proactive

Up until now, credit card regulation (and that for other financial products) has always been conducted by agencies, notably the Federal Reserve, that seem to regard their principal duty as being toward banks and businesses rather than consumers. The CFPB was designed to mirror that priority, placing greater emphasis on the needs of individual citizens, many of whom may be disadvantaged by the small print in standard-form contracts that are written by bank lawyers.

Of course, in an ideal world, the interests of consumers and credit card companies would converge. In theory, competition should drive out bad players in the supply end of the market, leaving credit card terms that balance the needs of both parties. However, in the real world the market is far from pure. It costs a huge amount to start a new card issuing business, and this often-insurmountable barrier to entry has left what some may regard as an oligopoly that has little incentive to moderate price gouging and “gotcha” clauses.

Two views of credit card regulation

The Credit CARD Act of 2009 intervened in the market to stop issuers’ worst excesses, and there’s little doubt that credit card terms are more reasonable now than they were before that legislation. However, government intervention in free enterprise often has unintended consequences, and many believe that the CFPB is a step too far in rebalancing the relationship between issuers and consumers.

That (along, possibly, with the substantial campaign contributions sometimes made by the banking lobby) is why a numerically significant group in Congress is demanding reforms to the CFPB’s structure in exchange for approving the President’s nomination for the bureau’s directorship, Richard Cordray, a former attorney general of Ohio and a famously energetic consumer advocate.

Cordray: brave campaigner or crazy zealot?

If you believe Faiz Shakir in today’s Washington Post, Cordray is a paragon:

President Obama has chosen an articulate, dedicated professional whose well-regarded record has earned him the opportunity to serve the American people. As Ohio’s attorney general, Cordray cracked down on big, mortgage-lending banks for constructing what he described as a “business model built on fraud.” He fought the practice of predatory payday loans and prosecuted unlicensed lenders. A former “Jeopardy” champion, he’s smart, savvy and genial.

However, Collections & Credit Risk, a trade journal for debt collectors, yesterday reported a rather different view:

Cordray, now the director of enforcement for the new bureau, was immediately painted by industry insiders as a strong consumer crusader. While critics had viewed [Professor Elizabeth] Warren–the architect of the bureau–as a zealot, observers said privately they would take her over Cordray.

So assuming Cordray is confirmed, is his CFPB going to be a just and powerful regulator, or an interfering meddler who ends up short-changing both credit card companies and their customers? That’s for you–and time–to decide.

Given some of the really quite rude things that he often says about banks and card issuers, you probably won’t be too shocked to learn that your blogger doesn’t have a single friend working for any of America’s credit card companies. So the mental picture he has of the scene in JPMorgan Chase’s marketing department on Monday morning is based entirely on speculation, and perhaps a little wishful thinking.

Chase executives must have spent months working with people at United Airlines to develop the new United MileagePlus® Explorer Card. And they must have been both pleased with the product they’d come up with (see below), and excited about its forthcoming launch.

Then the Monday morning bombshell: at 08:00 a.m. Eastern Daylight Time, Citi Cards and American Airlines launched a directly competing credit card. Imagine the scene at Chase: the panic, the tears, the recriminations. You’d have paid good money for a live video feed.

Of course, the executives who run credit card companies are made of stern stuff, and 23 hours, 30 minutes after Citi’s launch, Chase unveiled its new product.

Credit card from Citi and American Airlines

Citi may have stolen a march on Chase over its launch date, but it’s unlikely to win many prizes for the snappiness of its new product’s service-mark-laden name: The Citi Executive^SM / AAdvantage^® World Elite^TM MasterCard^®. And, although the new credit card offers loads of tempting features and services, its $450 annual fee alone means that it’s unlikely to have mass appeal. For the benefit of those to whom $450 is a mere trifle, here are seven of the most attractive benefits it could offer you:

1. Unlimited access to Admirals Club® airport lounges for you and your immediate family, or for two guests if you’re flying with friends or colleagues
2. Priority check-in, security screening and boarding
3. Your first checked bag flies free
4. No foreign transaction fees on purchases
5. Concierge service
   
6. 25,000 American Airlines AAdvantage bonus miles if you spend $1,000 on the card during your first four months as a cardholder
7. 10,000 American Airlines Elite Qualifying Miles when you spend $40,000 on the card in any one calendar year
   

Credit card from Chase and United

The new Chase credit card offers some similar benefits to the Citi product, though generally on a smaller scale. But then, with only a $95 annual fee (waived for the first year), you might expect that. So here are some of its key benefits and differences:

1. No restrictions or blackout dates: if United is selling a seat, you can redeem points to book it
2. Priority boarding–but not the check-in and airport-screening privileges that Citi offers.
3. Vouchers for United airport club lounges, but not unlimited access
4. Similar “first checked bag flies free” deal
5. Up to 30,000 bonus miles for credit card use and adding an authorized user within your first two months as a cardholder
6. Another 10,000 bonus miles if you spend $25,000 on your card in your first or any subsequent calendar year
   

Credit card rewards and small print

In common with every card issuer, Chase and Citi are likely to qualify these headline offers with plenty of small print, so be sure you read it before signing up for either of these new cards. In fact, it’s a golden rule to read the details of all card offers, and especially those surrounding credit card rewards programs, before you make an application.