by Alison Storm | 07/30/10

There are lots of opinions when it comes to credit cards, but a new study says credit cards are responsible for transferring money from the poor and giving it to the rich. The study, conducted by Scott Schuh, Oz Shy and Joanna Stavins, points to reward credit cards, which are often harder for people with low incomes to get. Those people are the ones that end up paying more for products, food and goods they use on a daily basis.

According to the study, about 75 percent of households use credit cards, a number that hasn't changed much over the past 20 years. However, spending on credit cards has increased, jumping from nine percent to 15 percent. The study says that as more people use credit cards for daily spending, merchants are forced to pay higher fees. And in order to pay those fees, merchants increase the cost of goods. Families that use reward cards to make those purchases are getting benefits that may offset those costs, but lower income families aren't getting any rewards.

According to the study, each year households that pay cash for goods and services pay $151 to those households that use credit cards to make purchases. And those families that use credit cards receive $1,482 from cash users in the form of rewards. The study recommends some changes that would limit the damage credit cards can have on the country's poorest families. "On average, and after accounting for rewards paid to households by banks, the lowest-income household ($20,000 or less annually) pays $23 and the highest-income household ($150,000 or more annually) receives $756 every year," according to the study.