Barron’s
As for President Donald Trump’s proposed 10% cap on credit card rates, from which airlines generate billions in revenue from co-branded credit cards, they may not materialize.
Jay Sorensen, founder and CEO of IdeaWorksCompany, a consulting firm that analyzes ancillary revenue such as airlines’ loyalty marketing, doesn’t expect the proposed 10% cap will be able to charge past the thicket of lobbyists in Congress.
A 10% rate cap would be “cataclysmic for co-branding,” Sorensen told Barron’s. “It would place the economics of the bank issuers in disarray, and this would have a profound impact on their ability to fund the airline programs.”