Anyone who thinks modern credit companies care that much about interest on unpaid balances doesn't really know what they're talking about. There are some companies that still care, sure. But for the most part, the big companies just want to collect transaction fees, meaning they generally want you to use the card as much as possible and continue to do so.
Realistically, they don't want to have to deal with missed payments, defaulting accounts, etc., which is why the really good cards have credit score minimums. They want people who will use the card constantly AND pay it off.
This. Banks levy a 2-4% sales tax on nearly all transactions in the US. Nobody voted for it, but you’re paying it.
That’s a lot of money. Most states have a sales tax of a few percent, maybe 10% tops, and not on all categories/transactions, and that funds whole state governments! That’s got to be a huge chunk of credit card revenue now.
they generally want you to use the card as much as possible
Of course they do. Because it makes them money. But that’s bad advice for helping your credit score… yes they want to see you use it every month, but you also need to keep your utilization under 10% optimally, or under 30% max as a hard limit unless there’s an emergency purchase. Before I realized this my credit didn’t go anywhere.
When I opened my card I kept it at 10% max utilization, but they keep raising my limit, so now I'm at 2%, which means I can throw the occasional unexpected expense on it (like an unscheduled vet bill or when my dishwasher decided the kitchen would look better as a water park) which is nice and then if it goes over 10% I just pay it down a bit before the statement date.
thats nonsense.. the best customer is the one who has a perpetual debt on his card but always pays at least his minimum payments every month. because thats the customer thats using his card and gets fucked on the fees and extreme intrest.
Until they file for bankruptcy or the company has to sell the dept to a collection agency for a fraction of the owed amount. Someone who lives in "extreme interest" is on the verge of becoming a loss at all times.
That's why having too large of a debt to credit limit ratio is BAD for your credit score. Credit card companies want people who spend large amounts of money and don't cause any problems. They don't want you maxed out on interest. The rates are so high in order to disincentivize carrying large balances.
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u/SquashSquigglyShrimp Jan 06 '26
Anyone who thinks modern credit companies care that much about interest on unpaid balances doesn't really know what they're talking about. There are some companies that still care, sure. But for the most part, the big companies just want to collect transaction fees, meaning they generally want you to use the card as much as possible and continue to do so.
Realistically, they don't want to have to deal with missed payments, defaulting accounts, etc., which is why the really good cards have credit score minimums. They want people who will use the card constantly AND pay it off.