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luvnet217

Joined: 02 Feb 2009
luvnet217's page
Posts: 12

551 Magic Points

Subject: credit card

Tue Feb 03, 2009 4:14 am

company if you will use the credit card to pay,for 12 months of payment of the products you buy,there is no interest from credit card.how do they earned without interest for 12 month?

carol

Joined: 27 Jun 2006
carol's page
Posts: 1307
Location: Los Angeles, California

29555 Magic Points

Tue Feb 03, 2009 6:04 am

Hi Luvnet

The first thing that comes to mind is about the things that every good service provider would consider. All good service providers would offer you a free tenure so that you may enjoy the benefits and see for yourself whether the product or service is actually meant for you and your family.
Within this time frame if you'd come across any problem and change your mind you may call the provider and cancel their service. This would not cost you a single penny out of pocket.
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Carol

Justin

Justin

Joined: 17 Jul 2006
Justin's page
Posts: 1240

28942 Magic Points

Tue Feb 03, 2009 6:23 am

The credit card company offers interest free period as it benefits from two sources:

Firstly, when you swipe your card at a merchant establishment, the merchant needs to pay about 3% of the total card amount as fees to the credit card company. Hence the interest free period of about 48 days which the customer receives is actually not a interest free. It is paid by the merchant as fees.

Secondly, you can avail a 12 months interest free monthly payments only for purchase from specific merchant establishments or for buying certain specific branded products. The interest you are not paying for purchasing the product for 12 months is paid by the establishment as a lumpsum fees.
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Justin

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