The profit source of China's banking industry is mainly deposit and loan spreads. However, with the rise of Internet finance, the spread between deposits and loans has been shrinking, and the profit margin obtained solely by the spread has been continuously compressed. Therefore, banks urgently need to find new profit growth points, so they found the blue ocean business of credit cards.
There are four sources of credit card profit: credit card fee, installment fee, cash loan interest, liquidated damages and penalty interest.
1. Credit card fee. Whether it's swiping a POS machine, online shopping payment or mobile phone payment scanning code, banks will earn a corresponding percentage of handling fees for every sum of money spent by credit cards. Although the single handling fee accounts for a small proportion, many a mickle makes a mickle, which also contributes a lot to the bank's profits.
2. Installment fee. Friends who have used credit card installment know that when buying some big items or valuables, although they are under the banner of "interest-free", they have to charge a handling fee, which actually accounts for about 12% of the consumption amount, which is not low. There are still many people who choose to repay by installments to share the repayment pressure of each installment. Looking at each installment alone, there are not many fees to be paid, but for banks, these are businesses with higher profits than deposits and loans.
3. Cash loan interest. Credit card also has the function of emergency cash withdrawal. In fact, it is a kind of cash loan, which charges interest on a daily basis, with a daily interest of five ten thousandths, much more than the traditional loan business. So in fact, banks will also encourage cardholders to take cash to use.
4. liquidated damages and penalty interest. Overdue breach of contract is not a good thing, but it is definitely inevitable. The value of credit is that someone will break the contract, and all trustworthy people are valuable. Liquidated damages and penalty interest are not a small sum, and banks also have thousands of ways to make you pay back the money.
In short, banks can always make money from all aspects of using credit cards, and the profit rate is not low, so all families are vigorously promoting credit cards, which is not in conflict with mobile payment. In fact, with the rapid development of mobile payment, credit card business is also in by going up one flight of stairs.