Comment on Credit card company rejects customers with too-good credit scoresComments−Aaronontheweb16yDo responsible customers actually cost the credit card companies money or do they just not bring in any revenue to speak of?−ars16yThey are borrowing money each month, without paying interest on it, so it does cost the credit card companies money.−Aaronontheweb16yLosing money in its time-value. Gotcha.Edit: I thought they still made money off of the vendor fees though?−ars16yThey do yes. Between 0.5% and 3%.It costs them some money to process an account though, send bills, handle payments etc. If someone is charging reasonably frequently then they are still profitable.
Comments
Do responsible customers actually cost the credit card companies money or do they just not bring in any revenue to speak of?
They are borrowing money each month, without paying interest on it, so it does cost the credit card companies money.
Losing money in its time-value. Gotcha.
Edit: I thought they still made money off of the vendor fees though?
They do yes. Between 0.5% and 3%.
It costs them some money to process an account though, send bills, handle payments etc. If someone is charging reasonably frequently then they are still profitable.