Credit card companies (Visa, Discover, MasterCard, AMEX) make their money through transaction fees. They make their money when you spend money using the card, regardless of any debts involved.

The banks that issue cards are a different matter. They also make some money when you use the card (some of which goes towards those credit card rewards you get, which is how they can do stuff like offer % back) but mostly they make money by letting you spend just enough money so as to be perpetually in debt. Your bank wants you to carry a balance. They want you to be paying them tens of percentage points of interest each year. The credit limit they give you isn’t the amount they want you to spend in one purchase, it’s calculated to be the maximum amount you can afford the running payments on, which will do nothing to touch the principal.

Sure, you can discharge the debt if you go bankrupt, but consider as well that your bank has a couple of other advantages. First, they get to see all your spending. They know how you’re spending your money, where, when. They also usually get to see your other information. They know how much money comes into your balance accounts each month, they know how much your rent/mortgage costs, they know how much money is coming in from Venmo when you borrow from family to cover debts you can’t pay, how much money you spend on food delivery apps, how much of an emergency fund you keep. They know how much money you’re spending on things that you don’t have to be, which is money you could be giving them instead, if it becomes a running balance. And at 25% interest, they only need this scheme to work for 4 years before they make as much money as they’d lose if you default on your entire balance. Plus, when you do have money in the bank, they get to use that money for other things while it’s with them. If you have a $100,000 credit limit, odds are pretty good you have an account with them holding a few tens of thousands of dollars. They get to use most of that until you ask for it back.

For the free (no-interest) versions, it’s a bullshit legal loophole in the US credit laws, or at least it was a few years ago. May have been more strongly codified since, though I bet almost nobody who could close it realizes the gap is there. The whole scheme is out of Australia, but I have no idea what their legal setup is.

The US requirements are basically:

• You can’t charge fees to host the plan
• You can’t charge % late fees, only fixed
• You can’t have more than 4 installments, meaning no more than 5 payments if you include an optional down payment
• You must not deny customers for means-based items, or using credit data. You can give them an effectively meaningless approval value though.

You as a customer pay late fees if you miss a payment, but they make most of their money by charging the merchant a higher transaction fee. So, it’s theoretically free for the customer, meaning it can fit into the loophole. Legally it isn’t a credit product.

The TL;DR is “because the law is full of holes and bullshit, and if it’s making people money then it’s not likely to change”

deleted by creator

You’re locking in on the wrong thing.

In 60000 miles, the above poster reports one gallon of gas was saved. That’s 0.05% assuming 30mpg. We don’t need hundreds or thousands of changes that each net us tiny results, we need big changes that can happen quickly and net tens of percentage points of improvement. Yes, small changes are not literally nothing, but solutions need to look like “40% fewer cars on the road” sorts of things if we want to actually accomplish anything at all.

The world doesn’t have time or space for us to make these minor, rounding-error changes. I know the argument will be “every little bit helps” but we collectively need to start making massive changes, and stop thinking of this as an incremental problem. We should still make improvements and strive for better efficiencies, but the practical reality is that those changes are too small, too slow, and too late.

While I certainly agree with your overall point, I’d guess that firefighters have someone who’s job it is to start the engine/truck while their fellows are donning their gear.