A new federal bill could alter how cashback, airline miles, and travel points operate. The Credit Card Competition Act (CCCA), supported by President Donald Trump and Vice President JD Vance, is designed to boost competition among credit card payment networks and decrease the fees merchants pay to process transactions. But banks warn the proposed changes could also affect rewards and benefits cardholders enjoy.
Trump renewed his support for the legislation on October 19 during a campaign appearance in Kansas for Senator Roger Marshall, one of the bill’s lead sponsors. The following day, the National Association of Convenience Stores (NACS) said Trump and Vance had publicly endorsed the measure seven times this year.
Supporters say credit card swipe fees are a big financial burden for retailers, including small businesses and convenience stores. They think that adding more payment networks to the mix would reduce processing costs and maybe save businesses some money.
How the Credit Card Competition Act Could Affect Rewards
Under the current setup, major payment networks such as Visa and Mastercard help process transactions with their cards. Merchants have limited options for routing payments and pay varying fees based on the card and the transaction.
The CCCA would require big banks to allow at least two unaffiliated payment networks on eligible credit cards. This would allow merchants to choose which network processes a payment, potentially encouraging competition and lowering fees.
However, banks argue that these fees help fund credit card rewards programs. If issuers receive less revenue from transaction fees, they could respond by reducing cashback rates, offering fewer travel points or changing other card benefits. Some issuers could also reconsider annual fees or other perks.
The banking industry’s trade groups have criticized the legislation, saying it could reduce rewards, increase the risk of fraud, and affect access to credit. Supporters say more competition would benefit merchants and perhaps lower costs for consumers.
What will happen is not known. Even when merchants save money, there’s no guarantee that savings will be passed through to consumers at checkout. Likewise, the bill, if it becomes law, wouldn’t automatically wipe out credit card rewards.
For now, the proposal alone doesn’t require cardholders to do anything. Whether consumers see any difference in their credit card benefits down the line will depend on how the legislation moves through Congress and the response from banks.
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