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End of Credit Card Rewards? [The Credit Card Competition Act]

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HighwayStar:
The Credit Card Competition Act aims to force banks to issue cards with a second network option, thereby eliminating the dominance of MasterCard and Visa. In practice this has a good chance of reducing interchange and killing rewards cards the way the Durbin amendment killed rewards for debit cards.  :pan:

Not sure if this actually has a chance of being passed, but this is the second year they have tried.

Scott5114:
Uh...I get rewards on my debit card... It's not a federally-chartered bank, though, so that might be why.

gonealookin:
Rewards card programs strike me as gimmicky, because there's nothing to guarantee the future value of the rewards.

My Southwest Airlines card (with Chase) gives me 2x points on most hotel purchases (direct with the hotel, not with an agency like Priceline) and also rental cars (again, direct, not through an agency).  At the current rate of 1 Southwest point = $0.015 in Southwest Airlines fare, that's a pretty good 3% rebate.  Nothing stops Southwest from changing the 1 point = $0.015 exchange rate though.  If they were to cut it in half to 1 point = $0.0075 then my 3% rebate becomes 1.5%.  Blah.  Also, to realize the full value I have to use my points on Southwest airfare; other redemption options such as using Southwest points for hotel stays have an exchange rate quite a bit lower than 1 point = $0.015.

Nevada's Congressional representation appears to be leaning against the legislation, because a lot of people use those travel rewards to take trips to Vegas.  I don't have a strong viewpoint either way.  If rewards are drastically reduced or eliminated I'll just take another look at the available credit card options and make a new selection.

1:
I support the bill. Businesses are currently losing about 3% to credit card fees. For a small business, this could easily kill it if it's not doing well to begin with.

The problem with the Durbin amendment for debit is that it set a minimum fee of 21ยข, which was an increase for small purchases rather than a decrease. This new bill would not have that problem, as it's not setting the cost itself.

Rothman:



--- Quote from: 1 on October 19, 2023, 07:29:55 AM ---I support the bill. Businesses are currently losing about 3% to credit card fees. For a small business, this could easily kill it if it's not doing well to begin with.

--- End quote ---

If it's not doing well, does it deserve to survive?

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