NEW YORK—Cash registers across America should post a new holiday shopping sign, “The richer you are, the less you pay.”
That may sound outrageous, but it's true, according to the Los Angeles Times.
“The U.S. payment system has turned cash registers into engines of economic inequality. Driving this new system, in which the wealthy receive large discounts and the non-wealthy don't, are ever more lucrative credit card reward programs and the government policies that promote them,” the Los Angeles Times said.
How consumers pay and how much they make is strongly correlated.
“What’s in your wallet? The answer depends on how much money you have. If you have been doing well financially for a while, chances are you’ve qualified for an elite credit card — with reward perks like frequent flier miles, hotel stays or cash back every time you shop,” the Times stated. “The wealthier you are, the higher the rewards and bigger the perks the card companies offer.”
Consumers who make less than top dollar can still qualify for a card, but it’s likely to have fewer rewards (3% becomes 1%), the Times said.
“And if you’re among the half of Americans considered to have ‘subprime’ credit, then you are more likely to be using your debit card with no rewards program at all,” the Times noted.