Of course they/we do. But, the Nash equilibrium is at 100% credit card use: if I stop using credit cards at vendors, I lose out on the benefits (interest-free

Of course they/we do. But, the Nash equilibrium is at 100% credit card use: if I stop using credit cards at vendors, I lose out on the benefits (interest-free loan, chargeback ability, rewards, purchase tracking through Mint), in return for a savings of 1 - N/(N-1) * transaction fee = zero. I have an incentive to keep using charge cards.