Am I missing something? AMEX has $8,620,000,000 credit card interest income and $4,042,000,000 interchange income, and $8,620,000,000 > $4,042,000,000. For companies such as Barclays and Discover where the interest income is over 9 times the interchange income, I would say that it is very likely that interest income is an integral part in funding the reward. Here is additional info. https://www.lendingtree.com/credit-card ... -payments/ Discover paid out $1.9 billion in reward payout and partner payments in 2019. From the link that I gave before, it has $1.06 billion in interchange income and $9.7 billion in interest income. So interchange income alone is not enough for the reward payout and partner payments.Your link actually shows that Amex earns more in processing fees than interest. But it is the exception.I think credit card companies receive much more from interest than processing fees. https://www.valuepenguin.com/how-do-cre ... make-money
That still doesn't detail what portion of each revenue stream is use to pay for rewards, whether it's from AF, processing fees or interest. For Amex it's clearly not the interest paying for the majority of rewards.
Regrading your statement "That still doesn't detail what portion of each revenue stream is use to pay for rewards, whether it's from AF, processing fees or interest." Money is fungible. I see no reasons (or even possible) to identity which portion of the revenue is paying for the reward. Similarly, I think most people do not set a rule to use a particular revenue stream (salary, SS, investment come) to pay the cable bill.
Statistics: Posted by student — Tue Apr 16, 2024 6:19 am — Replies 74 — Views 4959