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

Even if they lose a bit of money on some people, the vast majority of credit card holders who don’t pay off the full statement balance each month and end up paying interest and/or other fees are probably more than enough to offset that.