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Why do banks keep offering you credit cards? Here's the real reason

The article from MSN Money explains why banks are keen on offering credit cards to consumers. It highlights that banks earn revenue through various fees associated with credit cards, such as annual fees, late payment fees, and over-limit fees. Additionally, banks make money from the interest on unpaid balances, which can be substantial given the high interest rates on credit cards. Another significant reason is the interchange fee, which is a charge paid by the merchant to the bank for each transaction made with the card. This fee incentivizes banks to encourage more card usage. Moreover, credit cards help banks in cross-selling other financial products like loans or insurance, enhancing customer retention and profitability. The article also notes that while credit cards offer benefits like rewards and convenience, the primary motivation for banks is the lucrative revenue stream they generate.

Read the Full Mint Article at:
[ https://www.msn.com/en-in/money/topstories/why-do-banks-keep-offering-you-credit-cards-heres-the-real-reason/ar-AA1ABzPV ]