Credit Card Rewards Became a $9.2B Wealth Transfer

American Express’s premium credit-card rewards amount to $9.2 billion annually, funded by interchange fees that merchants embed in prices for all shoppers. Harvard Business School research shows cash and debit users effectively pay a 26% higher sales-tax-equivalent, while $30 billion shifts each year from those users to credit-card holders. The 2010 Durbin Amendment’s debit-fee caps lowered merchant prices but left credit-card rewards untouched, creating a regressive wealth transfer.