Credit cards do more than just move money around, though. And capping fees isn't ever going to be practical without shifting the risks around.

I pay for most things with a credit card. Here are the value-adds that I receive in exchange: * net-25 payment terms (eg free short term credit)

* anti-fraud: the money isn't actually taken from my account until I make a payment at the end of the month. This gives processors some skin in the game to solve fraud.

* warranty extensions

* risk of losing cash, either by loss or theft

* centralized accounting. No data entry.

I'm not saying the system is perfect. It can definitely be improved. But, personally, that's a pretty nice set of value that I receive in exchange for using the cards.

Is 2-3% excessive? Probably could be cut back. But if I'm getting 1% back, we're now talking 1-2% that it costs me. Seems likely that a big chunk of that is due to fraud, which isn't something that would disappear by legislating lower rates. (additionally, it opens the opportunity for me to churn cards. I haven't done the math, but I open 2-4 accounts per year and receive ~$500 in rewards. $1k in signup bonuses is at least 3-4% of my credit card spend. For those who are able to safely take advantage of the system, you actually can be net-positive PLUS receive the benefits above)

I do understand the frustration for people using cash, because they typically pay for these features regardless of whether they want to. I also sympathize with folks who want their purchases to remain more anonymous.

For me, however, the value is greater than the cost.

I don't want to legislate lower rates, I want to remove the regulatory barriers to entry for competition. And yes, credit cards do more than just move money around. This is part of the problem. Sometimes I want to just move money around, but in the U.S. it is actually impossible to do it in a way that is 1) fast, 2) cheap and 3) secure. There is no technological limitation to this. It's purely a result of regulatory capture by the banking and traditional money-transfer industry (e.g. Western Union) serving as a very effective barrier to entry for any competition.

Venmo and the like are pretty effective at all 3 for personal use. Acts as a trusted intermediary so you don't give your bank info to anyone you're paying/receiving payment from.

OMG, I don't even know where to begin to explain why Venmo is not the answer.

http://time.com/money/4036511/venmo-more-check-than-cash/

http://www.slate.com/articles/business/moneybox/2015/09/venm...

http://www.slate.com/articles/technology/safety_net/2015/02/...

Venmo is not the solution, it's a symptom of the problem.