That merchant fee gets split between the network (e.g. Visa) and the bank, so they net much less than you may think off that. They make far more on interest cha

That merchant fee gets split between the network (e.g. Visa) and the bank, so they net much less than you may think off that. They make far more on interest charged. That's why some high end cards charge a yearly fee. Its to recoup some of the rewards & perks costs in aggregate.