``Visa and MasterCard charge merchants about 2% of the value of every credit card transaction, and American Express charges even more. That may not sound like much. But consider that for balances that are paid off monthly (meaning most of them), the banks make 2% or more on a loan averaging only about 25 days (depending on when in the month the charge was made and when in the grace period it was paid). Two percent interest for 25 days works out to a 33.5% return annually... and that figure may be conservative.'' -- The article goes on and points out that this money isn't even really fronted by the banks; the debts are funded by the negotiable instruments created from YOUR credit card slips (that is, the IOU you sign is DIRECTLY monetized, at no risk to the banks...)

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