How does a Credit Card company make money?

Answer 1

the big one....
everytime you use the credit card, the store you use it in pays a transaction fee to the credit card company. I think is't 4% of whatever you buy.

This is why some places charge you for using a credit card

then you pay interest, fees and penalties

Answer 2

Yeeoow has it right. But don't ever let any merchant charge you a fee for using your credit card. That is a direct violation of the merchants agreement with the credit card company. In the case of VISA its written in the very first paragraph of the agreement. If a merchant tries to charge you, report them to VISA, MC, Discover, or whoever. You will get your money back on what they charged you.

Answer 3

some companies pay a fee for the credit card company to issue cards for their business espically gas companies

Answer 4

Actually, it's a lot more than interest today. FEES is a realy big part of their income. Late fee, overlimit fee, etc... Then, since you did not follow your agreement, they increase your interest rate to the default rate - 25-26-28 %!!

Answer 5

Rip-off charges for anything they can think of + the interest charged on the money being borrowed.

Remember, if you borrow £1,000 on your card...... you have to pay back considerably more than that.

Check this article out:
http://www.fool.com/ccc/secrets/secrets04.htm

Answer 6

With those outrageous interest rates they charge and the late fees they charge if you are even one day late.

Answer 7

One word: interest

Answer 8

interest, fees (late fees, checkcard fees, annual fees)