Maximizing cash-back rewards is one of the simplest ways to fight back against rising costs. It’s a straightforward move that turns your everyday spending into a tool for protecting your purchasing power.
Those rewards and financial benefits are at risk of being reduced or even eliminated, depending on how the Credit Card Competition Act (CCCA) plays out.
Please keep reading if you are interested in learning more about the bill, its potential implications for consumers, and what you can do about it right now.
What is the Credit Card Competition Act?
The CCCA is a proposed piece of federal legislation aimed at reducing the “swipe fees” (interchange fees) that merchants pay to banks when a customer uses a credit card.
At first glance, the CCCA—often referred to as the Durbin-Marshall bill—sounds like a clear win for consumers. The idea is straightforward: increase competition in the credit card processing market, reduce the fees merchants pay, and, in theory, lower prices for everyone.
But as with many financial policies, the real impact is more nuanced. If passed, this legislation could quietly reshape how credit cards work—and what consumers get in return for using them.
How the system works today
Every time you use a credit card, the merchant pays a fee—typically around 2–3% of the purchase. That fee doesn’t just vanish into the system; it funds much of what consumers value about credit cards. Cash-back rewards, travel points, fraud protection, and generous sign-up bonuses are all supported, directly or indirectly, by this revenue stream.*
In other words, the rewards you earn aren’t free. They’re built into the economics of the system.
What the bill changes
The legislation would require large banks to enable transactions over multiple unaffiliated payment networks, rather than routing primarily through dominant players like Visa and Mastercard. The goal is to introduce more competition and give merchants greater control over how transactions are processed, which should put downward pressure on fees.
That sounds like a textbook improvement. But when you change the economics of a system, you inevitably change the outcomes.
The tradeoff beneath the surface
If interchange fees decline, the pool of money funding rewards declines with it. That’s the central tension of the bill.
Credit card issuers are unlikely to absorb that loss quietly. More realistically, rewards programs would be adjusted over time—subtly at first, then more noticeably. Cash-back rates could drift lower, bonus categories may become less generous, and sign-up offers could shrink. What feels like a small change on paper can add up quickly for consumers who rely on rewards as part of their financial strategy.
The impact may be even more pronounced in premium credit cards. Those high-end products, with their travel perks and rich benefits, depend heavily on interchange economics. If that foundation weakens, the value proposition changes. Cardholders could see fewer perks, less valuable points, or higher annual fees to offset the difference.
Costs don’t disappear—they shift
One of the most important things to understand is that financial systems rarely eliminate costs; they redistribute them.
If banks earn less from interchange fees, they will look elsewhere to make up the difference. That could show up in the form of higher fees, less attractive promotional offers, or tighter lending standards. We’ve seen a version of this before: when debit card fees were capped in 2010, many banks responded by reducing or eliminating free checking accounts.
There’s little reason to believe credit cards would be any different.
The big question: will consumers see lower prices?
Supporters of the bill argue that reducing merchant costs will lead to lower prices for consumers. It’s a reasonable assumption—but not a guaranteed outcome.
Businesses don’t automatically pass savings along, especially when pricing is influenced by many factors beyond payment costs. Even if some savings do reach consumers, they may be small or difficult to notice. By contrast, any reduction in rewards would likely be immediate and obvious.
This creates an imbalance: the potential benefits are uncertain and diffuse, while the tradeoffs are more direct and visible.
What it means for consumers
If the CCCA becomes law, the biggest shift for consumers may not be dramatic, but gradual. Rewards programs are unlikely to disappear overnight, but they could become less generous over time. For those who have grown accustomed to earning meaningful cash back or travel benefits, that change could feel significant. To learn more about potential impacts, download this information brief.
More broadly, it’s a reminder that incentives drive behavior. When the underlying economics of credit cards change, the features and benefits consumers receive will change with them.
What it could mean for the broader economy
The CCCA aims to lower swipe fees for merchants, with supporters arguing that these savings could lead to lower consumer prices and increased business investment.
Conversely, opponents contend that the resulting loss in bank revenue would likely lead to the elimination of credit card rewards programs and a contraction in consumer credit access, particularly for those with lower credit scores.
Ultimately, the legislation’s net economic impact remains a subject of intense debate, as it depends on whether retailers pass savings on to shoppers or if consumers scale back spending due to reduced rewards and tighter credit availability.
If rewards are slashed and credit access tightens, some economists worry that a decrease in consumer spending—which accounts for about 70% of U.S. GDP—could slow overall economic growth.
The bottom line
The CCCA is designed to make the payments system more competitive and, potentially, more efficient. It may succeed in lowering costs for merchants. But for consumers, the story is more complex.
Lower fees on one side of the system could mean fewer benefits on the other.
Whether that tradeoff ultimately works in your favor depends on a simple but unresolved question: will the savings show up in your everyday spending—or quietly replace the rewards you’ve come to expect?
To urge Congress to vote ‘NO’ on the CCCA, use this tool from The Points Guy to contact your state representatives.
It Pays to Know!
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*Card issuers use interchange revenue—fees earned from merchants when customers use credit or debit cards—to cover transaction handling costs, mitigate fraud and lending risks, and fund customer reward programs.
Accepting credit cards benefits merchants by increasing sales through higher average ticket sizes, boosting consumer impulse buying, and offering convenience that drives customer loyalty. It also enhances cash flow with faster, secure transactions, expands customer reach, reduces theft risks associated with holding cash, and improves credibility.
In terms of cash flow, merchants typically receive funds from card transactions in their bank account within 1–3 business days. Thus, merchant discounts paid for card transactions are comparable to early payment discounts (e.g., 2/10 net 30) offered by suppliers (merchants) to accelerate payments and reduce Days Sales Outstanding.