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> In reality the average interchange fee is 1.8%. Is this really so? (I don't know, asking.) Many credit cards give 2% cash back, so they'd be operating at a
by jjav 3y ago
> In reality the average interchange fee is 1.8%.
Is this really so? (I don't know, asking.)
Many credit cards give 2% cash back, so they'd be operating at a loss. I'm quite sure credit card companies will never operate at a loss, so that can't be.
- AnthonyMouse 3y agoIt's both. The 2% cash back cards have higher interchange fees, but most people don't actually have 2% cash back cards.
- ceejayoz 3y agoThat 2% attracts plenty of balance-carrying people paying 29%.
- jjav 3y ago> That 2% attracts plenty of balance-carrying people paying 29%. Do you have data on that to share? It feels like that should not be the case, because the higher cash-back cards usually require a higher credit score. And people with a higher credit score are unlikely to fall into the trap of carrying a balance.
- ceejayoz 3y agoThe 2% cards aren’t that hard to get, and with something like half of Americans carrying balances some of them are gonna be 2% cardholders who ran up more than they realized on a 0% APR intro rate. You only need a few of those to make up the difference.