Consumers will be the losers with new regs on credit cards

The federal Credit Card Competition Act of 2023 (CCCA) has been touted as a means to reducing the credit card interchange fees businesses pay to process credit card transactions. But as can often be the case, government schemes to intervene in free-market transactions inevitably create distortions, misaligned incentives, and unintended consequences. Unfortunately, the CCCA would create more problems than it purports to solve.

Interchange fees aren’t just arbitrary costs. They cover a plethora of services: fraud protection, transaction facilitation, rewards programs, and more. By reducing inter...