Recently there was an article with this subject line in the Wall Street Journal. However, the author covered this subject in a simplistic and cursory manner. She didn’t really explore the numbers that drive this business, and she never really answered the question. Today, we are going to take a more in-depth look at it and come up with some answers.
First, we should recognize that rewards are important for people who do use credit cards — about three-quarters of the population. In fact, about a third of them say that when choosing a card, rewards are their most important consideration. While most people think of airline miles, there are two other reward types: points and cash-back.Read More