How 0% APR credits make money?
How 0% APR credits make money?
I mean, the price of the product is the same, I'm taking a loan for the duration of the credit but paying no interest?
What's the catch?
I can keep my money making a bit of interest instead of giving it right away and without increasing the price of what I was already planning to buy. When or why wouldn't I choose 0% credits?
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In addition to what everyone else in this thread has already covered, the credit card issuers benefit from you having that card in your wallet because they charge the merchant for every transaction. So you're having the merchant pay the credit card company with every swipe, in exchange for whatever benefits the card provides to you.
This is why gas is sometimes cheaper when you use cash or the gas station's own card. We pay the credit card companies to use their card on these transactions.
Partially the reason. I've seen between $0.10 and $0.30 per gallon more for credit cards even though merchants only charge <5%. At $4.00/gal, 5% is only $0.02 that they're paying the credit card companies so they're making extra profit off that too.
5% of $4.00 is $0.20. Think of it as 5 cents per dollar.
Woops I obviously shouldn't have been doing math before having my coffee.
I'm guessing this is why lots of merchants don't accept American Express? Probably have the highest rates hitting the merchants
You get what you pay for, though. I've had nothing but good experiences as an Amex card holder. You need to live a lifestyle that gives you opportunities to use the system, but you can offset the cost of even the Platinum charge card if you sign up for, and then use, all the perks.
For how I use it, I'd say it pays for itself.
edit to add: their customer service is always stellar, and their disputes department are really effective.
Oh yeah, no discredit to the services to the consumer. On the merchant side though, they don't want to pay for the higher fees to accept the cards