Why do credit card companies charge so much for late fees,it doesn't cost them that much in lost revenues?

Answer 1

Yeah, it is easy money for them. Credit card companies would rather have a person who is late on their payments every once in a while than someone who keeps everything paid up to date at all times.

Watch out, there are all sorts of new ways for credit card companies to soak their customers even more.

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http://moneycentral.msn.com/content/Banking/creditcardsmarts/P98888.asp

Answer 2

Everyone says its a major source of revenue. I also agree. But there is another side to it. Its the only profitable source of revenue from the credit card so they have to max from it.

Example: If you spend huge amount on card but pay it off within the date, then the card company gets nothing from it. They barely recover cost of doing business from the retailers. Hence no profit. So the only money making source left is to charge those careless guys who carry over the card expenses.

Answer 3

Because late fees are a great source of revenue for them.

Answer 4

Because, it is a big profitable to credit card companies. They are always thinking that, how to cheat credit card users.


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Answer 5

There is where they make their proffits, so dont pay late. Put yourself in the same position as the credit card companies, are you going to lend money without any proffit???

Answer 6

Because that is a major sourse of profit for them, because it costs them nothing.

Answer 7

Because they can!

Answer 8

it's easy money...wouldn't you do it ?