In China, the current profit model of credit cards is: 1, and interest income is the interest paid by cardholders on the outstanding balance of credit cards;
2. Information exchange income is the fee paid by the acquirer to the issuing bank, accounting for a certain proportion of the transaction amount of the special merchants;
3. The cardholder's annual fee is the fee paid by the cardholder to the issuing bank for obtaining the right to use the credit card; Other expenses and income include expenses and income generated by other credit card services, such as cash advance fee, loss reporting fee, fast card issuance fee, transaction password letter replacement fee, etc. The capital cost is the interest cost that the card issuing behavior must pay to obtain the outstanding fund balance in the bank credit card portfolio;
4. The service fee is the fee generated by the front-end contact with customers; Transaction processing cost is the cost generated by customer service in the background. 5. The rebate of special merchants refers to the fees charged by the acquiring institution to special merchants because they provide transaction processing and bear credit risks; Deposit interest income is the deposit interest income obtained from the deposit account of special merchants; Other income is the income from renting POS and card pressing machines. Of the credit card business profits, 78% comes from credit interest income, 10% comes from exchange fees, 2% comes from annual fees, 4% comes from cash withdrawal fees, and 6% comes from late fees and other income.
6, late fees, overrun fees, etc. ;
What are the profit models of credit cards?
The credit card industry should not simply pursue the amount of cards issued and used, and the issuance and use of credit cards must obey the profit target stipulated by the business model. In China, credit card business is still run by commercial banks, which are both issuers and acquirers. Let's discuss the profit model of credit card from two aspects: the issuing bank and the acquiring institution.
Interest income is the interest paid by the cardholder on the outstanding balance of the credit card; Information exchange income is the fee paid by the acquirer to the issuing bank, accounting for a certain proportion of the transaction amount of the special merchants; The cardholder's annual fee is the fee paid by the cardholder to the issuing bank in order to obtain the right to use the credit card; Other expenses and income include expenses and income generated by other credit card services, such as cash advance fee, loss reporting fee, fast card issuance fee, transaction password letter replacement fee, etc. The capital cost is the interest cost that the card issuing behavior must pay to obtain the outstanding fund balance in the bank credit card portfolio; Losses include bad debt losses and credit card fraud losses; The service fee is the fee generated by the front-end contact with customers; Transaction processing cost is the cost generated by customer service in the background.
The rebate of special merchants is the fee charged by the acquiring institution to the special merchants because they provide transaction processing and bear credit risks; Deposit interest income is the deposit interest income obtained from the deposit account of special merchants; Other income is the income from renting POS and card pressing machines. Of the credit card business profits, 78% comes from credit interest income, 10% comes from exchange fees, 2% comes from annual fees, 4% comes from cash withdrawal fees, and 6% comes from late fees and other income.
There are also some units that focus their profits on breach of contract and excessive fines, thus forming a new credit card business model. This profit model is a low credit card issued by the issuing bank for consumers who have difficulty in applying for consumer loans. On the one hand, the low credit line makes cardholders easy to default and overuse, thus increasing the fine income; On the other hand, low credit limit can reduce personal and overall credit risk.
How to make a profit on a credit card?
Profit model of credit card business:
Interest income is the interest paid by the cardholder on the credit card balance.
Information exchange income is the fee paid by the acquirer to the issuing bank, accounting for a certain proportion of the transaction amount of the special merchants; The cardholder's annual fee is the fee paid by the cardholder to the issuing bank in order to obtain the right to use the credit card; Other expenses and income include expenses and income generated by other credit card services.
The rebate of special merchants is the fee charged by the acquiring institution to the special merchants because they provide transaction processing and bear credit risks; Deposit interest income is the deposit interest income obtained from the deposit account of special merchants.
Other income is the income from renting POS and card pressing machines. Of the credit card business profits, 78% comes from credit interest income, 10% comes from exchange fees, 2% comes from annual fees, 4% comes from cash withdrawal fees, and 6% comes from late fees and other income.
Extended data
Credit card function:
1. Cash deposit in advance is not allowed. You can enjoy an interest-free repayment period and can repay in installments (minimum repayment amount). Join VISA, MasterCard, JCB and other international credit card organizations, which are universal.
2. It is one of the fastest developing financial services, and it can replace the traditional cash circulation in a certain range.
3. It has both payment and credit functions. Cardholders can use it to buy goods or enjoy services, and they can also use credit cards to obtain certain loans from card issuers.
It is a high-tech product integrating financial business and computer technology.
5. It can reduce the use of cash currency.
6, can provide settlement services, convenient shopping and consumption, enhance the sense of security.
7. It can simplify the collection procedure and save social labor.
8. It can promote commodity sales and social demand.