Fees and Interest and Merchant Charges. Late Payment Fee, Over Limit Fee, Annual Fee, Cash Advance Fee, Very High Interest. The banks will offer you credit when you have proven that you can make payments. Basically that is what your credit rating tells them. When you get a new credit card or loan it signals to the banks you are probably credit worthy. Credit Card Companies lose money on their reward programs. However they make 80% of their revenue from fees and interest that the majority of their customers are willing to pay. The Average American has over $6,000 in credit card debt. The average interest rate is between 20 and 24%. This means the Average American pays over $100 per month in interest. Many people spend over $1200 per year on credit card interest. This is why the banks are so happy to offer you a credit card. Merchant Charges When you use a credit card the merchant will have to pay between 1.5% and 4%. This means ...
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