Comment by strken | Hacker News Reader

Comment by strken | Hacker News Reader

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It's a hateful little piece of plastic. You carry it around in exchange for 2-4% cashback and fraud protection that should by rights apply to debit cards too, and the credit card company sits there hoping you give in to temptation and actually use the line of credit it represents, at which point they charge you usurious rates and distribute part of their loot to all the other poor schmucks they're conning.

I have one because my bank doesn't make a debit card with a spending limit over $2000, which isn't enough to cover all foreseeable emergencies. I hate it. I hate that I'm incentivised to carry it around, I hate the temptation it represents, I hate that normal debit cards don't get the "rewards" and "benefits" that function as bait on a hook.

Gen Z is an entire generation, and not one I belong to. However, I assume it's like every other generation in that it has people who are desperate, greedy, mentally incapable, or otherwise perfect victims for the bank to sink its teeth into.

> and the credit card company sits there hoping you give in to temptation and actually use the line of credit it represents, at which point they charge you usurious rates and distribute part of their loot to all the other poor schmucks they're conning.

It is kind of grim when I stop to think about how the probably several thousand dollars in cash-back bonuses I've received over the years of never paying a single cent of interest on my credit cards is probably subsidized by the people who do fall into this.

I believe, by design, it's subsidized by production of incentives of spending more in general.

Most of the money made by credit card companies is from the transaction fees paid by the merchant. Credit card companies would still be immensely profitable without receiving a cent of interest.

[Edit] This was my understanding but some fact checking on Google proved the majority of income is from interest payments.

> This was my understanding but some fact checking on Google proved the majority of income is from interest payments.

Yeah, the data I have seen says that 2/3 of the income comes from interest payments, 1/3 from tx fees.

>at which point they charge you usurious rates

If you pay the statement balance due instead of the minimum payment due on your statements, you will end up paying no interest.

The sky high interest rates only apply to statement balances that go past due, and having past due debt is also strongly disincentivized because they are horrible for your credit score.

If you only spend money you actually have with a credit card, you will be fine while also enjoying the many benefits of having and using a credit card.

If everyone only spent money they had with a credit card, then credit cards would not try to lure you in with free stuff and there would be no reason to use one. I pay my balance on time and "enjoy" "many benefits" derived from the human suffering of the people who weren't rich or sane enough to do so.

Credit card companies make money regardless of whether or not customers carry a balance due to interchange fees.

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