Credit Card: How Banks Secretly Empty Your Pockets & The Hidden Debt Trap

• Banks profit from credit cards via high interest (15-40% APR) on unpaid balances, various fees (annual, late payment, cash withdrawal), and merchant interchange commissions (1-3%).
• A 45-day grace period is offered, but missing the due date triggers daily interest accrual, turning users into "beloved customers" for banks.
• Credit cards encourage more spending by offering a loan, unlike debit cards which use personal funds, thus growing banks' business.
• Banks earn commissions from merchants and partner with platforms like Amazon and Flipkart for sponsored discounts, driving customer traffic.
• For smart users, credit cards offer benefits like rewards and cashback, but experts advise paying 100% of the bill on time and avoiding cash advances to prevent debt.

Why It Matters: Credit cards offer benefits but hide high interest and fees; pay 100% on time to avoid debt traps.