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Instead of giving cashback/point, why don't lower the transaction fee instead ?
by matz1 8y ago
Instead of giving cashback/point, why don't lower the transaction fee instead ?
- feifan 8y agoThe transaction/interchange fee is set by the card networks, not by any one card issuer. Merchants (businesses, restaurants, service providers, etc) pay that fee, not the consumer — cashback/points is basically a way of transferring some of that fee to the consumer. It's zero-sum at the end of the day.
- umeshunni 8y agoBecause that doesn't benefit the cardholder. It only benefits the merchant. And, due to contractual restrictions, merchants cannot offer different prices based on payment methods.
- matz1 8y agoLower transaction fee will benefit the cardholder, it enable the merchant to lower the price of goods/service.