Bank credit card income mainly consists of five parts: interest income and late payment fees, installment fees, commission income, cardholder annual fees, cash withdrawal fees, and other fees. Among them, interest, installment fees, and commissions are Main income.

1. Interest income and late payment fees

Interest income is the interest paid by cardholders on unpaid credit card balances, which is the main part of credit card income. Credit card repayments are divided into full repayments and minimum repayments. If you pay off the debt within the interest-free period, the bank will not charge interest. Otherwise, it will be a daily interest of 5/10,000 (annualized 18, with monthly compound interest), and it will also charge Late payment fees and the proportion of late payment fees are uniformly stipulated by the central bank and are 5% of the unpaid portion of the minimum repayment amount.

2. Installment fee income

To put it simply, the installment fee is the fee paid by the cardholder to purchase goods and pay in installments, which is similar to turning interest income into an intermediary business. Therefore, some banks include it in interest income for statistical management, and it is also another major income besides interest.

3. The card swiping fee paid by the merchant

The card swiping fee paid by the merchant is also the commission income mentioned earlier. When a customer swipes a credit card to make a purchase, the merchant must take out the transaction A certain percentage of the amount is paid to the bank as service fee.

4. Annual fee

In addition to the production cost of the card itself, a credit card also includes related costs for design, express delivery and marketing. Judging from the general situation in the entire industry , the cost of a credit card is about 150 yuan. If the cardholder does not activate the card, the 150 yuan will basically be wasted, so the bank will charge an annual fee to the customer.

5. Cash withdrawal fee

Cash withdrawal fee refers to the fee charged by the bank when you deposit an extra amount of money in your credit card and withdraw it at the counter or ATM. Some bank cash withdrawal fees are waived, which accounts for a relatively small proportion of credit card income.

Extended information

Credit card is a non-cash transaction payment method and a simple credit service. Credit cards are issued to cardholders by banks or credit card companies based on the user's creditworthiness and financial resources. Cardholders do not need to pay cash when making purchases with the credit card, and repayment will be made on the settlement date. Except for some credit cards combined with debit cards, general credit cards are different from debit cards and ATM cards in that credit cards will not directly deduct funds from the user's account.

Reference material: Baidu Encyclopedia-New Credit Card Regulations