This Week in Credit Cards: Colorado Governor Vetoes Credit Card Interchange Bill

The very active pen of Colorado Governor Jared Polis vetoed a bill this week that would have prevented credit card companies from collecting interchange fees on the sales tax portion of a bill in his state.

The move likely pleased credit card issuers that operate in the state as industry opponents argued the bill could have disrupted its popular rewards programs.

A governor we've dubbed "Veto Corleone" handed the credit card industry a major win. Plus, card delinquencies hit a 15-year-high, a Harvard paper explores Who Pays for Payments, and two cards stop taking applications.

Here's what happened This Week in Credit Cards 💳… pic.twitter.com/Z98QUa4qBJ

— CardRates News (@CardRatesNews) June 5, 2026

The Electronic Payments Coalition spent $6 million this year opposing the bill via ads. And the group said card companies in the state could stop operating if the bill became law, according to The Colorado Sun. 

The publication reported that Polis said he wasn’t comfortable signing the bill because it would bring an excess of legal risk to Colorado’s consumers and business environment while offering limited benefits to small businesses.

In other interchange news, the Illinois General Assembly opted to push the start date of the Interchange Fee Prohibition Act to July 1, 2027. The act, which aims to block card companies from imposing interchange fees on the tip and sales tax portions of a bill, had been set to take effect on July 1 of this year.

Americans probably don’t need statistics to tell them that times are tight from a financial perspective for many people in the country. But here’s one anyway: a new report reveals that the share of credit card accounts that were at least 90 days delinquent as of 2026’s first quarter grew to 13.12%, a nearly 15-year-high rate.

It should come as no shock that people aren’t keeping up with their credit card bills this year. The price of gasoline has risen sharply and other necessities like groceries have also grown more expensive.

People who have a decision to make between paying off the balances on their credit cards and keeping their car’s gas tank full may opt for the latter, especially if they depend on that vehicle to get them to work or school.

Total Household Debt Growth, Q1 2026

according to the Federal Reserve Bank of New York

$0 Billion$18 Billion

Credit card bills aren’t the only payment obligations people are struggling with this year. The Federal Reserve Bank of New York reported that total household debt grew in the first quarter by $18 billion to hit a total of $18.8 trillion.

Contributing to that figure were mortgage balances, which went up by $21 billion in the quarter, and home equity lines of credit balances, which grew by $12 billion.

Paying in cash for your purchases is one way to avoid falling behind on credit card payments. But people who use cash frequently can miss out on the bonuses they could have earned if they’d instead used a rewards credit card to complete transactions.

Credit cards can make life more convenient for consumers and businesses, though merchants pay a price to accept them. Some merchants pass the fees they pay to card processors on to their customers in the form of higher prices. 

Mark Egan, Professor of Business Administration at Harvard Business School, recently coauthored a study called "Who Pays for Payments?" Egan told CardRates that when credit card users face higher fees from merchants, they can get a portion of that cost back via their card’s rewards.

Cash users don’t have that advantage, and his team's paper suggested that it's a form of wealth transfer where cash and debit users subsidize premium card rewards to the tune of $30 billion each year.

Lower- and middle-income Americans are more likely to use cash while higher-income consumers are more likely to use premium credit cards that come with luxury benefits, the report said.

But NBC News reported that, according to the Electronic Payments Coalition, millions of families with low- and middle-income count on rewards programs that offer cash back and travel perks to help manage the increasing costs of everyday items. 

Discover is no longer taking applications at this time for the Discover it Secured Credit Card. The product, which offers cardholders cash back when they use it at gas stations or restaurants, doesn’t have an annual fee.

The card's perks may be particularly appealing to consumers who are having a tough time affording gas and food in 2026. But they shouldn’t worry too much about the card’s current unavailability.

Capital One purchased Discover last year, and it said it will relaunch the card sometime down the road in 2026, according to U.S. News and World Report.

In similar news, Citi has stopped taking applications for the Citi Custom Cash card. But this payment tool may be unavailable to new users for good. A post on the company’s website says current cardholders can keep using the card, but it directs those in the market for a cash back product to apply for another Citi card.

Fintech company Lava is offering a new credit card that’s likely to appeal to cryptocurrency enthusiasts. The company launched the Lava Card, which is a secured Visa product, this week.

People in the U.S. who open a Lava Card can earn 3% back in Bitcoin on purchases. But Lava told Bitcoin Magazine that it is marking the card’s launch by allowing cardholders to earn 5% back on purchases they make from Amazon, Apple, and Netflix. 

Bitcoin has had a rough start to 2026. As of June 4, the digital currency was down more than 27% on the year. But for BTC evangelists, the drop in Bitcoin’s price may mean it’s a good time to acquire more of the coin. After all, over the past five years Bitcoin has risen in value by more than 78%.

Since the Lava Card is a secured card, consumers will need to fund it. They can do that with a bank transfer or direct deposit, but they can also put money on the card by sending stablecoins straight to Lava.

For consumers interested in trying out a card that offers Bitcoin rewards, the Lava Card may be a convenient option. The card doesn’t come with an annual fee or charges for foreign transactions.