It’s partly this and partly the fees retailers pay to accept the cards are higher compared to here, thanks to the EU. Our credit cards are a bit rubbish and don’t often come with benefits worth much.
I’ve got a rewards card here which has probably earned my about £4 in rewards points and my US one by comparison has just paid for a long haul flight and car hire.
Yes, in the US, retailers have to pay fairly exorbitant rates on credit card purchases. These costs of business are factored into the prices people pay, and so borne by all. The net effect being that it’s a nice little tax on those who can’t get a credit card (or are only offered basic/expensive ones) for the benefit of the wealthy to get ‘free benefits’.
The cap is a good thing to be honest, while credit card users got their rewards slashed it helped more small businesses take them and meant lower prices.
Debit card and cash users also no longer subsidize the few that use credit cards.
You say this - but then at home who’s subsidising all the people using cash to pay?
I’d say it’s just a cost of doing business. The credit fees aren’t exorbitant anyway it’s just a few %.
The swype fees can be more than 5% in US.
5% is alot beacuse of a minority who use credit cards to push prices up by.
It creates a barrier to small buisnesses wanting to take credit cards and swipe fees can be in excess of 5% of the transaction value compared to the cap of 0.3% for credit and 0.2% for debit in the EU/UK.
I agree 5% is way to much unless you’re going to factor that into your pricing structure.
I would be interested to see the debit card v credit card usage figures over the last year to date. I’m not convinced about it being a minority but I don’t expect the numbers to be anything like those of debit cards.
The whole US/UK banking systems are completely different so I’m not sure I see much benefit in directly comparing the two, other than to acknowledge the differences.
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