How credit cards work
Take a look at your credit card.
On the front, you’ll see the branding for the card — maybe a logo, a store brand, or a nonprofit organization.
Now turn it over and look at the back. Usually in small print at the bottom you can find the issuer of the card. That’s the bank where you send your payments each month.
Sometimes the branding and issuer of the card are the same, but often they are not — and the bank that issues the card is who gets all the fees associated with it.
Credit card issuers make money in three ways:
Annual fees you pay to use the card — not all cards have this, and you should look for a card that doesn’t.
Interest fees you are charged if you don’t pay off your card in full each month — these interest rates are extremely high and should be avoided if possible.
Transaction fees the merchants pay for each purchase — usually around 3% of the purchase price.
If the issuer of your credit card is a major bank that is lending to large corporations and industries that harm communities, then it’s time to look for a better credit card.