Financial Activism

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Tech Billionaires Zuckerberg, Bezos, Pichai and Musk at US Inauguration Jan. 20, 2025

Why Paying Cash is Fairer, Wiser, Cheaper than by Credit Card

A credit card may be convenient and necessary online, but:
Paying by cash means less exposure to fraud and ID theft and
Merchants pay less in fees to banks and billionaire owners — so they don’t have to raise prices for us all, especially low-income families who also bear most of the burden of Credit Card Debt, now at $1.3 Trillion and growing as this Trump-caused recession grows!

From WalletHub Mar 9, 2026
AVERAGE CREDIT CARD PROCESSING FEES:
Mastercard: 1.79%  /  Visa: 1.97%
Credit card processing fees are paid in exchange for the secure processing of payments by a credit card network such as Visa or Mastercard.
In 2025, fees generally ranged from 1.15 to 3.30% per transaction.

There are three main types of processing fees:
Swipe fees (interchange fees), network fees, merchant service fees.

RECORD PROCESSING FEES IN 2024:
U.S. credit card companies earned $150 billion
in swipe fees, costing families on average $1,200 annually.
Merchants pass swipe fees to consumers via surcharges
or higher prices, with debates on fee limitations ongoing.
 (For example, gas stations often charge less if you pay by cash.)

Range of Credit Card Processing Fees

Network Minimum Rate Maximum Rate
American Express 1.43% + $0.10  3.30% + $0.10
Discover 1.40% + $0.05  2.40% + $0.10
Mastercard 0.00% + $0.10  3.15% + $0.10
Visa 1.15% + $0.25  3.15% + $0.10

NOTE: Data is from 2010– all amounts are larger now.
The minimum rate for Mastercard is from gaming.

5 Reasons Why You Should Use Cash for Everyday Purchases

Who Gains, Who Loses from Credit Card Payments? Theory, Calibrations
A regressive, negative transfer (tax) from higher to lower income families.

Reducing merchant fees and card rewards
would increase consumer welfare.

Merchant fees and reward programs transfer costs from credit card users to non-card (or “cash”, usually lower-income) users because merchants generally do not set differential prices for card users to recoup the costs of fees and rewards. On average [as of 2010– all amounts are far larger now] each cash-using household pays $150 to card-using households and each card-using household receives $1,133 from cash users every year.

Because credit card spending and rewards are positively correlated with household income, the payment instrument transfer also induces a regressive transfer from low-income to high-income households in general. On average, and after accounting for rewards paid to households by banks, the lowest-income household ($20,000 or less annually) pays $21 and the highest-income household ($150,000 or more annually) receives $750 every year.

Top 25 Finance Scandals in History [2026]


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