Interestingly, in Japan, at least until recently, the way credit cards worked is, when you buy something you'd have to say how many payments you were going to pay it off in and your bank would automatically take money from your bank account at that level.

In other words, you'd go to some electronics store and by a $2000 TV and they'd ask "how many payments". You'd say 10 and you'd end up paying $200 a month. I don't know the origin of why they did it that way. To be clear, this was bank credit cards, not store cards. I imagined it was something to do with the commitment and knowing you couldn't just pay off some minimum. Purchases under a certain amount and/or by store you were not allowed to divide up.

I've had Japanese friends come to America and want to buy something for $500 and ask if they can have ask for 4 payments and have to explain that system doesn't exist here. If you want to make 4 payments you make 4 payments.

I've never looked into if the bank is giving all the money to the merchant and then charging the customer per month or if they're sending to the merchant per month. Nor did I ever look into interest fees. I just know it is (was?) common.