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Revolver |
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A revolver is a credit card holder who rolls over some portion of their credit card balance due to the next month rather than paying the full amount due. According to an industry study, nearly 7 out of 10 credit card users are revolvers and that's good news for banks and bad news for consumers.
Why Is There No Profit In Being A Revolver?
Revolvers quickly discover that the practice of putting off paying their balance in full comes at a high price. How high that price is depends upon the interest rate the card issuer is charging them.
Credit Card issuers love revolvers because of all the interest income that gets generated when bills are not paid in full. In fact, if you're a dedicated revolver, and you keep making your payments on time, the credit card issuer will reward you by regularly raising your credit limit in hopes that you'll start revolving an even bigger balance.
Banks generate so much revenue from revolvers that, in many cases, enough money is made to offset credit card debt losses created by charge offs. That's why the bank loves revolvers and why there's no profit in it for you.
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Credit Card Definitions > N - Z > Revolver
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