In the EU this business model has been gutted by regulatory changes which have pretty much fixed the percentage fee at such a low level that there is no margin

In the EU this business model has been gutted by regulatory changes which have pretty much fixed the percentage fee at such a low level that there is no margin to offer rewards. > Hopefully the interest paid on debts breaks even with the defaults. Well, fundamentally it must do otherwise the business model for CC companies is pot. Actually, the core for any CC is, of course, the data scientists who build the risk models to work out that red line. > So you should ideally have at least 3% of every transaction to give back to the user in rewards while living off of the 30 cents per transaction. From that you have to pay the bills, and of course MC/VISA take a cut too. Don't get me wrong; it's totally fine to work with that 3% but... a) it's a fixed part of any transaction, which is a pretty dependable to get in your coffers (as opposed to, some money each month for your customer which you might not get depending on their circumstances) b) it would be very easy for this fee to get regulated (as in the EU) and thus kill your business model. Lots of risk there. Not to put you off. I think there is definitely innovation worth doing in that space. > I have been contemplating creating a new credit card the last few years. Takes an insane amount of money (because; you have to front a lot of "cash" to your customers in the form of credit, obviously). I'd be super interested if you do this because (having recently started working at a CC company) there is a lot of innovation to do in this space!