Summary
Retail credit cards often have high interest rates and hidden fees, which can harm consumers. Branded stablecoins are being proposed as a new way for retailers to reward customer loyalty without causing debt. These digital currencies can offer quick, cost-effective rewards and may replace traditional credit cards in the future.
Key Facts
- Retail credit cards give perks but can come with high-interest rates, often much higher than regular credit cards.
- If people don't pay off their retail credit card balance in time, they can face big penalties and even retroactive interest charges.
- Many consumers, especially those with low income or who are young, find it challenging to avoid these fees.
- The number of people using retail credit cards has decreased by 36.7% since 2015.
- Branded stablecoins are digital currencies anchored to the U.S. dollar and can serve as a modern alternative to credit cards.
- Stablecoins avoid interest and fees, providing rewards like store credit that settle almost instantly.
- Stablecoin transactions have low costs and use blockchain technology, which can improve how loyalty rewards are managed.
- Retailers using stablecoins can eliminate the need for banks and card issuers, maintaining a direct relationship with customers.
