Congress might actually crack down on the crazy fees banks charge retailers when consumers use debit (not credit) cards, and this might happen:
Consumers also could save money, particularly at businesses like grocery stores that compete on price. But some experts warned that lower profit margins could lead banks to curtail bank card reward programs.
You mean that instead of competing on “rewards” or “miles” or some other impossible-to-price shiny bullshit, banks might actually have to compete on quality of service and fees?
Also, too, I’m not an economist like McMegan, but it does seem a wee bit odd that banks charge 1.6% of the transaction for use of debit cards. That’s almost as much as they charge for credit cards (usually 2-3%). In the credit transaction, the bank is taking a risk by making a loan to the cardholder. But a debit card transaction is essentially riskless for the bank. There’s small risk of fraud, but other than that, the bank is simply taking money out of your account and transferring it to the retailer’s.