On Tuesday, the largest credit card companies in the United States reached an agreement with merchants to reduce the so-called swipe fees retailers pay for accepting credit card payments, potentially saving the retailers $30 billion.
These fees also help fund the credit card rewards programs that many travelers redeem for things like free flights and hotel stays, leading points hawks to wonder: Are loyalty programs at risk?
Last year, credit card payments generated an estimated $72 billion in fees paid by merchants, which are generally passed along to customers in the form of higher prices.
For nearly 20 years, merchants have been seeking reductions in the fees they pay Visa and Mastercard for handling transactions where the cards are used.
It would also allow merchants to potentially charge consumers more based on the card they pay with.
Organizations:
Visa, Mastercard, Chase Sapphire Reserve
Locations:
United States