Prepaid credit cards are used to rebuild credit. Consumers will deposit money into an account and use that money to spend with the credit card. Learn how credit card companies will eventually allow the consumer to use regular credit cards after a prepaid card withinformation from a registered financial consultant in this free video on credit cards. Expert: Patrick Munro Contact: www.northstarnavigator.com Bio: Patrick Munro is a registered financial consultant (RFC) with outstanding sales volume of progressive financial products and solutions to the senior and boomer marketplace. Filmmaker: Reel Media LLC

why use you own credit or bank card whn this is more secure?

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So you are stuck in a credit card with an interest rate that keeps moving up.  If you want to move to a card that has a more reasonable rate, then you are at the right place.  The UK Credit Card Centre promotes a variety of credit card that have low interest rates associated with them.

 We all use credit cards. The ease and convenience of credit cards is part of everyone’s financial day to day activities. So it’s obvious that we all want to reduce our costs associated with the use of credit cards. Although there are many way to reduce your credit card costs, the easiest way is to apply and qualify for a low rate credit card. You can save hundreds each month with a low rate card. When you transfer credit card balances from one card to another to take advantage of low introductory or promotional rates can result in significant reduction in interest or finance charges. Similarly, financing purchases with low introductory or promotional purchase rates can result in significant interest savings. At the UK Credit Card Centre, we offer many credit cards with low interest and low APR rates.

 The MBNA 6.7% American Express credit card offers a low 6.7% rate on your purchases, balance transfers, and money transfers.  Plus this without fees (transfer must be made within first 60 days).  With the MBNA 6.7% American Express you also get access to a fantastic rewards programme where you earn when you spend.  Redeem rewards for flights, cash, shopping vouchers and much more. Find out more about the MBNA 6.7% American Express Credit Card.

 The Barclaycard Simplicity Credit Card is another example of a low rate, low interest credit card targeting the UK market.  Barclaycard, a leader in the UK credit card market, offers the Simplicity card with a very low 7.8% interest rate.  So if you’re tired of having to find a new credit card each time the promotional offer on your current card ends, let us make life simpler for you. This card offers one low rate – 7.8%, applies to every purchase and/or balance transfer you make.  The Barclaycard Simplicity card not only offers a low rate, but also unparalleled benefits including Identity Protection Service, safe shopping with Fraud Protection, purchase delivery protection, emergency help when traveling abroad, and great holiday deals with our Travel Service.  Learn more about the Barclaycard Simplicity Credit Card.

To wrap up our discussion on low rate, low fee credit cards in the UK, we decided to include the MBNA Rate for Life Visa Card.  This card offers a promotional low rate on balance transfers and money transfers – 5.9% for the life of the balance.  This card is ideal for rearranging your finances and consolidating loans.  This promotional rate does come with a 2% transfer fee.  To learn more about the MBNA Rate for Life Visa Card.

Like all credit card decisions, you need to take the time to understand the interest rates and fees associated with each of the card.  To find out more, please visit the UK Credit Card Centre

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Prepaid credit cards, also known as prepaid debit cards, are becoming popular among people unable to qualify for a checking account or credit card. With all the card options, it’s always helpful to know what you are doing before you go out and get a card.

Often, people look at prepaid credit cards as being all the same; however, different cards have different types of fees, features and services. This article will guide you on how to find a prepaid card that is right for you.

Step One: Identify Card Use

If you are in the market for a prepaid card, the first thing you should do is identify why you are getting the card. Will you be using it on a regular basis? Or will it only be used for special occasions? The majority of cardholders use prepaid cards to handle their personal finances, such as paying for groceries, bills, and other necessities. On the other hand, some people like using prepaid cards for special occasions, such as vacations, traveling, and online shopping. Identifying how you will be using your prepaid card will help narrow down your card options.

Step Two: Identify Card Features

From the previous step, you identified how you plan on using your prepaid card, now you need to identify what card features you are looking for. ATM withdrawal and direct deposit is common among most prepaid credit cards and usually a necessity; however; some features, such as SMS text alerts and short-term loans, are more of a luxury and only offered on select prepaid credit cards. For example, a card with higher deposit limits and free bill pay may be more important features if you’re using the card to handle most of your personal finances, but not as necessary for someone using it just for vacation. Make a list of features you need, a list of features you want, and a list of features you can deal without. This will come in handy when you begin searching card offers.

Step Three: Identify Card Fees

The last thing you will need to identify when choosing the right prepaid credit card are the fees. Every card is set up differently and has its own fee structure. Not all prepaid cards charge the same type of fees, but some of the more common fees you can expect to see are: activation fees, monthly fees, bill pay fees, ATM fees, and transaction fees. Identify all the possible fees you can expect to pay along with an ideal and maximum amount you are willing to pay for each fee. This step helps by set a budget for how much you are willing to spend on your prepaid credit card.

Step Four: Card Comparison Sites

Now that you have an idea of what you are looking for in a prepaid credit card, it is now time to start shopping around to find the card that fits your needs. With so many prepaid cards available to choose from, it can be quite time consuming searching through so many card offers online, this is why card comparison sites are so useful. Most credit card comparison sites have categories for prepaid credit cards, but since these sites are formatted for traditional credit cards, the prepaid information may not be as useful. It is better to use a card comparison sites that are designed primarily for prepaid credit cards. These websites are great information resources for finding the right prepaid card; you can compare prepaid credit cards, read card reviews, and get information on a variety of prepaid credit cards without searching the internet for each card individually.

Step Five: Apply and Review

Now that you have used a prepaid card comparison site to find the prepaid card that matches what you need in a card and what you are willing to pay, all you have to do is apply. Once you have applied for the prepaid card that is right for you, write a card review on the prepaid card comparison site that you used. By writing card reviews, you can contribute to the community of prepaid card shoppers by sharing your own personal experience with the card.

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Although consumers continue to grow more eco-conscious, when it comes to shifting to paperless credit card statements, many cardholders are afraid that going green will make it more challenging to stay out of the red.

According to a recent survey conducted by GfK Roper Public Affairs and Media, even though many cardholders are comfortable making payments online, 71 percent of cardholders still opt to receive paper credit card statements. When asked why, most cardholders report that they like having the credit card bills lying around to remind them when their payment is due. Many consumers also express a preference for paper-based record keeping.

However, online statements can provide some unique benefits, which you may want to consider. Here are some pros and cons of going green:

Pros of Paperless Credit Card Statements

View statements sooner. Signing up for paperless statements means that you get almost instant access to new credit card statements, giving you several extra days to review the account and send in payment or pay online.

Paperless statements take less space. Downloaded statements can be easily saved to a computer hard drive and backed up on a separate disk, instead of filling up filing cabinets. In addition, most operating systems feature search functions that allow users to locate information contained within documents; in other words, if you are looking for specific transactions, you can simply click “find” instead of having to sift through each and every statement. You have plenty of time to download the statements, many issuers will store statements on online account pages for an average of 12-24 months.

You might also consider downloading credit card transactions into a book-keeping software like Quicken or Quickbooks, which keeps all transactions at your fingertips and makes it easy to track your expenses (always a good idea to do even if you stick with paper statements).

Deter fraud. Online credit card statements eliminate the paper trail that accompanies snail-mail statements. Would-be thieves who stoop to sift through your trash will be left with only old newspapers and banana peels.

Protect the environment. For many cardholders, this is one of the biggest reasons to switch over to online credit card statements—and for good cause: if even just 10 percent of households were to switch to electronic bills, statements, and payments, we could save over 75 million pounds of paper and avoid using the 51.5 million gallons of gasoline necessary to mail them. This tiny switch would also protect over 900,000 trees and prevent the production of nearly 2 billion pounds of greenhouse gasses.

Cons of Paperless Credit Card Statements

No bills lying around as a reminder. Many cardholders rely on the visible paper bills as a reminder to send in their payment. In absence of a paper statement, many consumers are concerned that they will forget to send in their check on time, particularly for credit cards not used regularly.

To help remedy this, experts suggest signing up for cell-phone text alerts to remind you of an approaching payment date. Most credit card iPhone apps also offer payment-reminder services. In addition, card issuers automatically send out e-mail statement notifications when electronic bills are ready to view, and also lets you sign up for email payment reminders to notify you both when a bill is coming due or is late. Some people also find it useful to coordinate bill payment dates so that all credit card bills come due at the same time.

No hard copy to file. People used to paper-filing systems may be uncomfortable switching to electronic storage of their credit card information. Some fear that all their financial records will evaporate into thin air should their hard drive crash. While this is a valid concern, it is easily remedied by doing frequent backups, which most computer users already do anyway (or learn the hard way that the should be doing). Online backup services, like Mozy.com, iDrive.com, or Carbonite.com, which automatically back up computer hard drives in the background, can be well worth the modest subscription fee for the peace of mind they afford.

Unfamiliarity. This may be the biggest hindrance of all. If you’re used to paper statements, switching to e-based statements does take a commitment to changing longstanding habits. If you’re motivated to switch, take one step at a time by first signing up to make payments online on your card issuers’ websites. Keep the paper statements coming until you get comfortable managing your credit cards online; and then make the decision whether or not to go paperless.

Switching to paperless credit card statements will entail some extra work at first, but for many, the rewards are well worth it. By switching to paperless statements, even just one household can prevent the production of 171 lbs of greenhouse gasses, likely well worth the effort for more eco-conscious consumers.

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Getting approved for a credit card can be difficult without a positive credit history working in your favor. It’s a Catch-22: To obtain a credit card, you need a good credit history. But to have a good credit history, you need to establish good credit!

This no-win cycle can keep people with a non-existent, limited or negative credit history from getting approved for a credit card. But it doesn’t have to if you understand the type of credit cards available and how to build a good credit history.

When it comes to credit cards, the type of card you apply for will depend on your situation. If you’re a student, you’ll, naturally, sign up for a student card. But if you’re a non-student with a non-existent or bad credit history, a card that is secured or obtained with a co-signer may be your best option. With co-signed credit cards, the co-signer guarantees and is responsible for the debt. This means that the co-signing person is responsible for paying the full amount of the debt if the card holder doesn’t pay. In fact, when co-signed debt goes into default, three out of four times co-signers are normally asked to repay what is owed, according to the Federal Trade Commission.

Furthermore, the issuing bank can attempt to settle the debt without first trying to collect from the card holder. The bank can also use the same collection methods against the co-signing individual, including suing and garnishing wages. If the debt is not paid, it can leave a negative mark on the credit history of the co-signer, as well as the card holder.

Despite the risks, a co-signed credit card can be great tool for helping a friend or relative build their credit history so they can one day obtain a card on their own. Secured, co-signed and pre-paid credit cards offer viable options. But you should start building a strong credit history, so you can obtain a regular credit card on your own in the future.

First, you need to understand how credit card issuers determine credit worthiness. The approval criteria varies from among issuing banks, but generally relates to what’s often called the three C’s of credit: capacity, character and collateral. Capacity refers to your ability to pay based on your income and existing debt. Collateral refers to any assets you have that can secure payment, such as bank accounts or home ownership. Character refers to factors like your payment history, length of employment, etc.

To get a good idea about how your application will fare with credit card companies, check your credit history with one of the major credit reporting agencies: Experian (www.experian.com), Equifax (www.equifax.com) and TransUnion (www.tuc.com). These agencies access your payment information directly from the companies you have credit with, as well as from government agencies such as the legal court system.

Credit reporting agencies use the information in your credit history to determine your credit rating or credit score. Credit scores, also known as FICA or Beacon scores depending on the CRA, generally range from 350 to 850. Most banks will approve you for credit if your score is at least 620. If your rating is 720 or higher, banks will offer you their lowest interest rate.

Generally, y our credit score is determined by your payment history for the last two years. T echnically, CRAs calculate your score using a closely-guarded formula. TransUnion, for example, determines credit scores using a variety of factors, including: how you pay your accounts, how much you owe and how often you’ve applied for credit.

http://www.credit-cards-rates.co.cc/

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Learn about credit card debt and low interest rates from a registered financial consultant (RFC) in this free personal finance video.

Expert: Patrick Munro Contact: North Star Navigator

Bio:  Patrick Munro is a registered financial consultant (RFC) with outstanding sales volume of progressive financial products and solutions to the senior and boomer marketplace.

Filmmaker: Reel Media LLC

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Get out of debt quick with these simple yet powerful strategies from Sharon Hague.
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If currently carry a balance on your credit cards, chances are you are spending hundreds, if not thousands of dollars a year on interest. How much money you waste every year will vary based on how much credit card debt you have, but, according to studies, the average American household carries approximately 00 in credit card debt. At a modest interest rate of 12%, this would translate into 0 a year in interest expenses. If the interest rate is higher, say 16%, carrying a balance on your credit card could be costing you over 00 a year in interest!

0% APR balance transfers provide an excellent solution to consumers who carry debt. With one of these offers, you can enjoy an entire year without interest to help you pay down your current debt and prevent compounding interest from moving your credit card balances into the stratosphere. Here we will discuss the benefits of 0% balance transfers.

The best type of 0% offers are for no fee balance transfers. Buried in the fine print of nearly all credit card applications is the balance transfer fee. This nuisance fee applies to 3% of all balances transferred. Over the past year, balance transfer fees have risen quite a bit. Generally, the maximum dollar amount does not exceed – per transaction. However, a few sneaky companies have put no limit on fees.

Fortunately, with a no fee balance transfer, you can avoid these fees. In some instances, the fee to transfer a balance can add up to 0 or 0 on an 00 balance transfer, depending on how many different cards you need to transfer balances from.

Because there are a limited number of no fee balance transfer credit cards on the market, the next best option for balance transfers is to find a credit card that offers a 0% APR on purchases and balance transfers for 1 year. While the number of these offers is becoming somewhat limited, finding a credit card that offers 0 APR balance transfers as well as a 0 APR on purchases is easier than finding a no fee balance transfer credit card.

To select the best balance transfer credit card, begin by looking at the dollar cap on fees for each transaction. This can be especially helpful if you are simply transferring a balance from one credit card. For example, if you have an 00 balance on a single card, your maximum balance transfer fee will be to , or around 1% of the transaction.

The effect of balance transfer fees grows when you have many small balances on multiple cards, as each card you transfer will be counted as a single transaction with a 3% fee. For example, if you have one credit card with a 00 balance, two credit cards with a 00 balance and a third credit card with a 00 balance, your total balance transfer fee will be 5 or 2.4% of the balance.

Even though paying a balance transfer fee isn’t the most pleasant of experiences, the savings you can reap with 0 balance transfers more than offsets this annoying fee. For example, if you are transferring 00 from a single credit card with a 15% interest rate, your total interest savings, including fees, will be close to 00. Now, even if you have to transfer balances from multiple credit cards, and thus pay multiple fees, you will still be saving over 00 on interest. Plus, this doesn’t even take into account the amount of money you will save with your 0% interest rate on purchases.

Aside from 0 balance transfers, there is one last type of balance transfer offer. This is the fixed APR balance transfer. For some people, it may be worthwhile to use 0 balance transfers for a number of years, transferring your debt from one company to another until the balance is repaid. However, there is always the chance you may not get approved for a 0% rate in the future. If you would prefer to avoid this risk, a fixed APR balance transfer may be right for you.

With a fixed APR balance transfer, you pay a set rate until your balance is repaid in full. For example, a typical fixed APR balance transfer offer will provide a 5.99% interest rate for life. A few credit cards offer no fee fixed APR balance transfers, but the majority do not. Thus, if you opt for a fixed APR balance transfer over a 0 APR balance transfer, your interest rate in the first year will be closer to 8.99% with fees. However, if you know it will take you many years to repay your balance, the long term rate of 5.99% can provide great savings and the security of knowing your interest rate won’t be going through the roof anytime soon.

Overall, the best option for consumers looking to lower their credit card interest rates is a 0 APR no fee balance transfer. However, since these offers are difficult to come by, the next best option is to find a credit card that offers 0 APR balance transfers and a 0 APR on purchases as well. Lastly, consumers looking to pay down their debt over the long term may want to consider a fixed APR balance transfer. However, as with any type of credit card, always look for one with low or no balance transfer fees.

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Being buried in credit card debt is far from uncommon. But that doesn’t mean that’s the way it should be. Carrying a high balance on your credit card – or worse, several credit cards – can take a big bite out of your budget. You might only be able…

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Next to the cost of housing and food, saving for your kids’ college and for retirement are generally the two largest financial outlays of American families. Believe it or not, financial rewards credit cards can be a help to either save some of the money needed to put junior through college or to build up your own retirement nest egg. While not offering a magic formula, if you start early and get other family members involved, rewards earnings on everyday expenditures can add up to a respectable amount over the years. Here is our pick for the best financial rewards credit cards of 2010.

The Bank of America Upromise Card
The Upromise MasterCard sounds like a way to have your cake and eat it too, and if used right, it can be. The card’s rewards earnings lets you save money for your kid’s college, or to pay down your own student loan.

Even better, the Upromise MasterCard promises rewards earnings on steroids. Cardholders who shop with UPromise partner vendors can maximize rewards earnings to 3 to 4 percent on clothing and gas, and as high as 14 percent on groceries. Grandma and grandpa can also get involved in saving for their grandkids’ college; by joining the Upromise network, relatives can direct rewards earned on their everyday purchases to your account as well. You can choose to invest earnings in a high-yield savings account or tax-deferred 529 plan; use it to pay down a student loan; or request a check that can be used for college or other expenses.

There is a catch, however. The Bank of America Upromise credit card itself simply offers a 1 percent rewards earnings on purchases, so to get the supercharged rewards, cardholders must shop with the affiliated retailers, online stores, grocery stores, and restaurants in the Upromise network. With these totaling almost 75,000, including leading retail chains and websites, this isn’t really that hard once you know where to look. For online purchases, simply go to the Upromise.com portal and look for affiliated vendors. For the about 22,000 grocery stores affiliated with the program, you must locate the ones near you on the Upromise site and then get a Upromise registered grocery or drugstore card to show at check-out in order to get rewards earnings credited to your account. Not all products are included, however, so look for items with the Upromise logo on items and store shelves, or simply go online to see which products are covered. Retailers typically offer rebates of 1-3 percent, and the Upromise credit card rewards add another 1 percent.

People applying for the Bank of America Upromise card must have a household income of at least ,000 and be a Upromise member; it is easy and free to register at UPromise.com. Also, to receive eligible retailer rebates, new cardholders must register their Upromise credit card online with Upromise.

While the BofA Upromise card offers no magic formula for saving for college or paying off student loans, everything helps, particularly if you start early. As for all rewards cards, however, keep in mind that if you keep a balance on the card or pay the card late, interest charges or penalty fees will quickly exceed rewards earnings.

Fidelity Rewards American Express Cards
Fidelity investments offer three financial rewards credit cards, which feature an attractive and refreshingly simple rewards structure: cardholders earn a straight 2 percent cash back on all purchases (excluding returns).

The three Fidelity Amex rewards cards only differ in where rewards earnings are directed. The Fidelity Retirement Rewards Amex card, as the name implies, lets cardholders accumulate rewards in their Fidelity IRA account. Rewards earnings for the Fidelity Investments Amex card are deposited into a Fidelity investment account, and the Fidelity Investments 529 College Rewards lets cardholders earn rewards for deposit in their 529 college savings account. Like for the Upromise card, family members can get a card as well and link their earnings to your 529 college savings account, a popular feature with grandparents.

The Fidelity Amex rewards cards have no annual fee, and there is no cap on rewards earnings. You must have a Fidelity brokerage account to apply for the card, however, there are no fees to open or maintain an account.

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Lawmakers on Capital Hill continue to look for ways to lower credit card interest rates and fees for consumers. Hundreds of proposals that would restrict credit card companies have been offered that will appeal to consumers, especially when finances are tight. Coming almost exclusively from liberal Democrats and so soon after the enactment of the CARD Act less than a year ago, the prospect of passing new legislation is questionable. (more…)

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As the Senate returns to work this week, millions of unemployed Americans will be anxiously waiting to see if Senate Democrats will find the last vote needed to pass the unemployment extension for the long-term unemployed. So far, the Senate has failed three times to muster the votes to pass the bill, leaving millions of Americans with only one remaining option for putting food on the table and paying their bills: credit cards.

Many of the near 10 percent unemployed Americans are facing acute financial hardship: having used up their emergency savings and even their 401k savings, many are now looking at losing their homes, their cars, and even their phones. Some report being unable to even pay for the gas they need to go out hunting for a job.

For people in such situations, credit cards provide the only recourse left for keeping their heads above water. However, turning to credit cards to pay bills provides at best a short-term solution, at worst only exacerbates the situation. While putting a utility bill on plastic may keep the water running for a while, those who eventually are unable to keep up with even the minimum monthly credit card payments, face penalty interest rates as high as 29.99 percent on their credit card debt.

In addition, credit card issuers already struggling with record credit card defaults are more weary than ever of customers who look like a potential future credit risk. According to a new study of credit card lenders by the Federal Reserve, several major card issuers seek to protect their bottom line by keeping an eye out for cardholders who show signs of financial hardship. For example, cardholders making frequent charges for everyday purchases like groceries and utilities, or who develop a high debt-to-credit ratio, may well find their credit limit cut or find it difficult to get approved, when they apply for a new credit card.

Senate Republicans have been blocking the employment extension bill, citing fears that the bill will further increase the U.S. deficit. Proponents of the extension bill argue that plunging millions of Americans further into financial distress will only serve to worsen the economic downturn and thereby weaken the country’s ability to deal with the deficit.

Meanwhile, the Senate is expected to try for another vote on the unemployment extension by mid-July. Political pundits predict that, with a democrat filling deceased Sen. Robert Byrd’s seat, next week’s congressional session may well deliver more hopeful results for the millions of Americans still unable to find work.

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US consumer credit card debt fell .32 billion in May, at an annualized rate of 10.5 percent, according to a recent Fed report. The drop represents a considerable acceleration compared to the first quarter’s 9 percent annualized decline. Economists had predicted a far more modest .3 billion decline.

The .32 billion decline in revolving credit brought U.S. credit card debt to 0.83 billion. Since its 6.1 billion high in October of 2008, total consumer credit card debt in the U.S. has dropped over 5 billion with consistent decreases throughout the past 20 months. Furthermore, revolving credit card debt isn’t the only category that has taken a steady dive: total outstanding consumer debt, excluding mortgages, has dropped 15 times in the past 17 months and decreased a further .1 billion in May.

It’s difficult to tell what percentage of the continued plunge in credit card debt stems from Americans’ new credit habits, and what percentage can be attributed to write-offs of bad debt, as well as banks’ increasingly conservative lending policies. Banks have been cutting back credit limits on existing credit card accounts, and have become far more selective in accepting new credit card applications. In addition, major credit card lenders like Citigroup, Bank of America, Capital One, and Chase are shouldering record credit card defaults, a factor that has contributed considerably to the dramatic decline in credit card debt levels over the past couple of years.

With unemployment continuing in record territory, analysts also point out that greater concern for the future has left Americans more hesitant to charge today and pay tomorrow. Indeed, the Commerce Department has reported a rise in the U.S. savings rate from its low of early 2000.

In addition, a survey conducted by the consulting firm Market Strategies International reports that nearly 42 percent of consumers are paying with cash more frequently than they were a year ago. An increasing number of consumers are also favoring debit cards over credit cards; MasterCard International reports a 10.5 percent rise in debit transactions, and Visa reports 17 percent increase.

Regardless of which factors have played the largest role in the decrease in outstanding credit card debt, the 20-month decline in consumer credit is an indication of a substantial ongoing deleveraging of consumer finances, which hopefully will result in a more stable financial foundation for millions of Americans.

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Do you ever wonder if it would be possible for someone to create a counterfeit credit card, by making up a credit card number and producing a fake credit card with the number encoded in the magnetic stripe?

Well, not surprisingly, in the same way as bills and coins have numerous built-in defenses against fraudsters creating counterfeit currency, so do credit cards. The credit card expiration date and the three or four-digit security code on the card both serve as important verifications of the authenticity of the card. However, tthere is another important safety mechanism built into credit card numbers themselves, which most cardholders are not aware of. In fact, credit cards’ first line of defense against fraud was developed before computers—and is still used today by every credit, debit, and ATM card in the world.

All credit card numbers are created using a simple, mathematical formula to verify the authenticity of the number. Proposed in 1954 by German-born scientist Hans Peter Luhn, the elegant formula (dubbed the “Luhn formula”) was originally used to hand-check the accuracy of data entry. Now, with today’s technology, computers can check the Luhn formula faster than the blink of an eye—and weed out fake credit card numbers before they are ever sent to an issuer for verification.

Every card issued, whether a 16-digit Mastercard, Visa or Discover card, 15-digit American Express card, or 14-digit Diner’s Club/Carte Blanche card, uses this formula in its digits.

The way the Luhn formula works is simple, although it takes a few calculations. To find your credit card’s Luhn number, follow the steps below:

1. Write out your credit card number.
2. Starting with the second to last digit, double every other number. Write each new number down beneath the old, and cross out the old number.
3. For any double-digit numbers produced by step two, add together the digits to create a single digit number. Jot that single digit number down beneath the double-digit one, and cross out the old double-digit number.
4. Add all non-crossed out numbers together.
5. The total should be a number divisible by 10.

Any time a card-processing system runs this formula and receives a number not divisible by 10, it immediately knows the card is either a fake or the information was mistyped.

The Luhn formula isn’t the only code in play on your credit card. For 16-digit Visa, MasterCard and Discover credit cards, the first six digits represent the card issuer, while the next nine are the actual account number; the 15-digit American Express cards use eight-digit numbers to identify card accounts. In addition, the last number of the card also plays a key role in card identification and validation.

The Luhn formula, which was originally used in a hand-held mechanical reader, has played a role not only in today’s credit card numbers, but also in the development of the world wide web, Google and other such search engines, text messaging, and more. As most mathematicians would agree, the Luhn formula is just one example of how modern day man benefits from mathematics in all aspects of life, without ever realizing it.

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After some signs that consumers were starting to catch up on their credit card bills, charge-offs are back on the rise!

Reuters: Capital One Financial Corp and Discover Financial Services reported that credit-card charge-offs rose in November — a sign that consumers remain under stress.

In a regulatory filing on Tuesday, Capital One said the annualized net charge-off rate — debts the company believes it will never collect — for U.S. credit cards rose to 9.60 percent in November from 9.04 percent in October.

In another regulatory filing, Discover said its charge-off rate rose to 8.98 percent from 8.54 percent after two months of declines.

JPMorgan’s charge-offs are up as well.

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See Also:

• CHART OF THE DAY: The Amazing Spiraling Mortgage Delinquencies
• Credit Corrosion Continues With Bank Delinquencies At A Record
• Best Buy Sees A Stingy Consumer This Christmas

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