Senators Dick Durbin (D-IL) and Roger Marshall (R-KS) have re-introduced their bill to crack down on credit card interchange. That’s the cost businesses pay to accept credit cards. Since banks and card networks like Visa and Mastercard make money on each transaction, they spend money to encourage those transactions. That’s what funds credit card rewards. It’s even to a large extent what funds the airlines, when carriers like American often don’t make money flying planes but ultimately earn money selling their miles to banks. Reducing interchange reduces card rewards. Of course if that were somehow good for the world, it would be tough to argue for our miles and points. But it isn’t good for the world. Countries that have capped interchange haven’t seen prices fall to consumers. Consumers are used here a fig leaf…
