Despite lousy response rates to direct mail offers, U.S. credit card issuers keep stuffing mailboxes with what seem like unbelievable deals. Some introductory rates are now as low as 0% and apply through early 2002. If the Feds cut rates any more, card issuers may pay consumers to sign up for new cards. Or you might be able to transfer a balance to a new card and watch the balance shrink without making any payments. Dream On!

Citibank, First USA, and Providian have been hitting mailboxes this month with 0% offers on VISA and MasterCards. While the cards offer super low rates they also come with some low blows in the fine print.

Citibank is offering a low 0% interest rate on balance transfers through next April on its Platinum Select MasterCard. But the card comes with a low blow in the form of a balance transfer fee. Citi charges a 3% balance transfer fee, subject to a $5 minimum and a $29 maximum. Citi also applies your payments to balance transfers first before reducing the balance on any purchases, which accrue interest at the rate of prime +5.99%. Of course if you make any mistakes with the account, like making late payments, Citi will nail you with a punitive interest rate of prime +14.99%.

First USA's Titanium VISA, in the mail this month, also promotes, in very large type, a 0% APR on purchases and balance transfers until December 1. But, in very small type, the nasty balance transfer fee appears. First USA levies a 3% balance transfer fee subject to a $5 minimum and a $35 maximum. (There is a $50 maximum fee on the Republican National Committee Platinum VISA First USA is also promoting this month.) Like Citi, First USA applies payments to lower interest balances first. First USA's other low blow is the use of the two-cycle average daily balance method of calculating interest, which greatly impacts cardholders who pay off their balances occasionally.

Providian's Platinum VISA offers what seems to be best of the 0% APR deals. The 0% interest rate applies to balance transfers, balances, and cash. Unlike Citi and First USA, Providian does not charge balance transfer fees. However the rate has a shorter term and there is low blow when it comes to cash. While credit lines on the card range from $5,000 to $30,000, you can only get a $1,000 cash advance initially.

As with any credit card offer, what is boldly plastered on the front of an envelope may shrink in significance once you pull out the magnifying glass and read the fine print in the disclosure box.

TECHNO CARDS

Clear or translucent credit cards have been the latest marketing gimmick, adding to the high tech appeal of smart cards. This month smart card manufacturer Gemplus rolled out a new line of translucent cards. The new GemLucence cards are available in TechnoTone colors including: Cyber, Photon, Enertia, Synergy, Electro, Nitro, Quasar, and Kinetix. Gemplus says that unlike other translucent cards in the marketplace, the GemLucence cards permit the execution of three-dimensional graphic treatments in the card design. In the U.S., translucent cards took hold after the introduction of the American Express 'Blue' card in 1999 and the MBNA Quantum MasterCard last summer. Last September, Providian introduced the first translucent smart VISA card. This year the French bank, Banque Directe, introduced a translucent VISA Carte Bleue smart card. How long will clear cards be popular? Where's Clear Pepsi?

TV SMART CARDS

As general acceptance of smart cards in the U.S. begins to build, new, sexy technologies for loyalty applications will explode. St. Louis-based VEIL Technologies is now promoting a system which allows consumers to electronically download promotional coupons from a television commercial directly onto a smart credit card. Indeed, Target indicated this month it is focusing on developing a loyalty function with its upcoming launch of a co-branded smart VISA that could enable a cardholder to download electronic coupons onto a smart card from a PC. The patented VEIL technology allows digital information to be invisibly delivered by an ordinary television's video image, allowing individuals to download offers during encoded commercials from a television monitor, without any external devices such as set top boxes. With VEIL technology added to a smart card, consumers could download offers from television, electronic kiosks, monitors, then present their VEIL enhanced smart card to pay for their goods/services using the same card. "VEIL" stands for "video encoded invisible light". In October, the company demonstrated its technology in conjunction with an interactive promotion created for Ericsson Mobile Phones during ABC's "Who Wants to Be a Millionaire."

JENNA & TONIC

Here is a solution to eliminate the Jenna Bush problem. Credit card terminal manufacturer VeriFone this month installed multi-application POS terminals in three liquor stores in Arkansas and Colorado to check a customer's age as well as accept credit card payments. The Easy ID software running on the terminals enables merchants to conduct age verification by swiping magnetic-stripe driver's licenses, which are used in 33 states, or by keying in the birth-date that appears on licenses without a magnetic-stripe. The software keeps a journal of the last 500 transactions on the terminal, indicating date, partial license number, birth date, product(s) requested and whether purchase was approved or denied. One of liquor stores plans to add applications to accept check payment, PIN-based debit card payments and a loyalty program.

CARD AMBASSADORS

A new survey by First USA found that approximately two-thirds of college students will pay their own credit card bills this fall, and that 23% of all purchases made by college students will be handled with credit cards. In conjunction with the release of the student survey, First USA also announced this month it will underwrite the college tuition costs for two innovative high school seniors from New Jersey. The two students launched an unprecedented campaign this year seeking corporate sponsorship for their college careers. First USA responded by selecting the two students as "student ambassadors" for First USA Bank, in exchange for college tuition at Pepperdine University and University of Southern California. One of the students wrote a book and launched a website, while the other student produced a CD and toured the East Coast with his band. First USA says its survey found that two out of five high school grads plan to carry a credit card with them to college and 63% will pay the bill themselves, while parents will cover the bill for 36%. First USA also found that 71% of this year's 1.7 million college bound high school seniors will work part-time in their freshman year.

MONOGRAM LATE FEES

The U.S. Supreme Court this month refused to consider an appeal by GE in regard to the state bank status of GE's Monogram Credit Card Bank of Georgia. The appeal centered on a federal trial judge's ruling Monogram is not a state bank as defined by the Federal Deposit Insurance Act. The ruling is crucial in determining if Monogram is allowed to export credit card pricing to residents of other states without regard to local laws limiting such fees. This week's decision is seen as victory in a class action suit filed on behalf of a Louisiana resident. In 1995, Patricia Heaton used a 'Campo' credit card issued by Monogram and was subjected to an annual interest rate of 21.84% and an $18 annual fee. After accumulating $297 in late fees, Heaton filed suit claiming the APR and late fees violated Louisiana law.