BANKING GENERAL KNOWLEDGE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The credit card company expects that the person will continue to make purchases and carry a balance after the introductory period when credit cards interest charges go back to normal rates.
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Credit card companies get tax breaks based on the number of people who use their cards.
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Late fees charged to all the people who take advantage of this offer make up for any money lost by not charging interest on the account.
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Detailed explanation-1: -To encourage more spending. Credit card companies make money from so-called interchange fees every time you make a purchase. And the more debt you rack up, the less likely you are to repay your full balance within the 0% term.
Detailed explanation-2: -WalletHub, Financial Company Credit card companies offer credit cards to people with no credit in order to give newcomers a chance to prove themselves and because credit card companies have found a way to make doing so profitable.
Detailed explanation-3: -In most cases, a 0 percent APR is a promotional interest rate that lets you borrow money at no cost for a fixed period, often between 12 and 21 months. During this time, you still need to make at least the minimum payment each billing cycle, but you won’t accrue any interest costs.
Detailed explanation-4: -Credit cards are one of the most common ways you can build credit and finance large purchases. Plus, many come with additional perks, like the opportunity to earn cash back or miles. However, you should take a minute to consider whether it’s the right time to add a new card to your wallet before you apply.