How do credit card companies afford to “give cash back”? Like how does the process work?

Question

How do credit card companies afford to “give cash back”? Like how does the process work?

In:

Answer 1

When you buy groceries for $50, they may only give the grocery store $48 to $49 back. Giving you $0.50 of that $1-$2 looks like a great way to encourage you to use the card more often. Further, if you keep using the card, there’s a chance you’ll pay a late fee or some interest someday, too.