eli5 How do credit card companies make money out of people that pay their cards in full before the billing cycle and still get rewards?

Question

eli5 How do credit card companies make money out of people that pay their cards in full before the billing cycle and still get rewards?

In: 808

Answer 1

The ones who make minimum payments typically make up for that, but as others have pointed out the big three (Visa, Chase, American Express) take percentages of every transactions from businesses. AMEX is the highest which is why they aren’t as widely accepted, but most if I remember take between 2% and 5% depending on the size of the transaction.

This is why a lot of small business up charge for using a card