Your credit card reward exists because someone else is paying an annual interest rate (APR) of 25%. If the APR upper limit is set to 10%, these points cannot hold up. I have been working in fintech and credit card projects for many years. That portion of the interest difference is a hidden buffer zone that allows rewards, airport lounges, and various credit limits to be accounted for. Setting the credit card APR limit to 10% sounds like a clear consumer victory. Credit cards now charge interest rates of 20% to 30%, and many consumers will repeatedly owe, making the entire system feel very punitive. But the economic model of credit cards is not just about interest rates. It is a cross subsidy system: revolving debtors subsidize one-time full repayers, rewards rely on behavioral inefficiencies, and risk-based pricing subsidizes access opportunities. If one leg of this stool is removed, the system will not become fairer; It will only rebalance. And the cost will appear in the places where consumers are most likely to notice. Let's take a look at how this will affect three credit card projects: 1AMEX Platinum Setting the credit card APR limit to 10% will not make your card cheaper or better. You can still apply for the card, but it is almost certain that you will receive less value with the same amount of money (or even higher annual fees). The reason why platinum cards can survive is because their customer base is affluent, fully repays, and can tolerate high annual fees. What silently supports this ecosystem is the profitability of the entire investment portfolio, which allows American Express to tolerate losses, overuse, and inefficiencies in high-end benefits. When the profit margin narrows, the cost will be directly reflected in the reduction of your benefits. In a world where the reward economy is tightening: Devaluations are becoming more likely to occur • Reduced flexibility Points have become a liability for the issuer, and the liability needs to be re priced. So, for you as a platinum cardholder, this is likely to mean: Airport VIP lounges will not be expanded to address congestion issues. On the contrary, access will be tightened or facilities will be reduced. Statement credits will become more difficult to use, fragmented, or less generous. The annual fee will increase New card approvals will become more demanding, even for high-income earners. Your card can still be used, but the value proposition will change. Platinum cards will become more clearly "pay and enjoy", with fewer hidden subsidies to support high-end benefits. You pay the same amount (or more) but receive less in return. That's also why some people are already warning that point depreciation is more likely to occur in this environment (for example, @ BowTiedBull said this morning: "Sell all your credit card points. All of them 2Bilt Card (Bilt Credit Card) This project is like a canary in a coal mine, foreshadowing what we will see. The reason why Bilt's super popular rental rewards can run is because Wells Fargo is willing to subsidize them. This card offers 1 point/USD on rent with no transaction fee, as Wells Fargo pays approximately 0.8% (80 basis points) per rent to fund rewards for Bilt... even though exchange fees are almost or never earned on these transactions. But this is an actuarial level mathematics that involves many risk variables, and the results have proven to be incorrect/unsustainable. Wells Fargo loses about $10 million per month on this project, so they withdrew from the partnership a few years before the originally scheduled end date, forcing Bilt to restructure its reward structure with another bank. What inspiration does this give us? When the difference between interest and exchange fee profits shrinks, banks no longer tolerate reward programs that lead in losses. Interest income does not directly fund every reward, but it provides a buffer for experimental projects like Bilt to exist. Remove this buffer, and the reward must be clearly paid. The shift of Bilt towards a three-tier structure and the introduction of annual fees is not an abnormal phenomenon. This is the direction in which reward programs will go when credit stops quietly absorbing losses. Pay and enjoy rewards. Something that feels like consumer protection will ultimately manifest as fewer benefits, pay as you go rewards, and less room for innovation. 3Credit One and other Subprime Cards Now let's look at the least glamorous corner. The subprime credit card has been criticized for its high APR, high annual fees, low credit limits, and minimal rewards. But their existence has a reason. They serve borrowers with credit file books, credit damaged individuals, those who are rejected by traditional loans, and households who treat cards as liquidity... but they charge high APRs because bad debt rates exceed 8-10%, fraud and service costs are higher, and fixed costs are high due to small credit limits. The 10% upper limit makes these products mathematically impossible. These cards will not become cheaper. They will disappear directly. As @ sytaylor pointed out this morning, "Do you realize that this will push more customers towards high interest loans The demand for credit will not disappear... it will shift to BNPL (buy now pay later) (effective APR opaque), long-term overdrafts, heavily charged installment loans, and less regulated lenders such as high interest loans/payday loans. So who will win? Debit First Fintech Companies One least discussed consequence: where will reward customers migrate to? I think a 1% cash back program would be a clear winner. Chime、Varo、Current， And segmented cards like Greenlight and Privacy. If you haven't worked in fintech or banking, you may not know what Durbin Amendment is - in simple terms, the debit card exchange fee for large banks (BoA, Wells, JPMC) is capped at around 27 basis points. Small banks with assets below $10 billion are not restricted - they can earn 1-2% on exchange fees (the average I checked last time was about 160 basis points). That's why all the debit card fintech companies you've heard of are partnering with these small banks - they can offer rewards like a 1% cashback while still having enough profit margin to establish a business. ） In a world where credit rewards are shrinking, access is tightening, and annual fees are rising, debit card based fintech looks better. But consumers will lose: losing credit protection