Will a credit card issuer cancel an account if it never incurs interest?
While technically true, a card issuer can cancel your card for almost any reason they want, it's highly unlikely they'll cancel it because you pay your bills! There are many, many people out there that pay their bills in full every month without ever paying a cent in credit card interest. I wouldn't ever purposefully incur any interest on a credit card. Related anecdote: I used to have a credit card that I only used for gas purchases because they gave 5% off for fuel. The issuer eventually discontinued the program (I assume because people like me took advantage of it.) So while they didn't cancel my card, the bonus eventually went away. I miss that card. My conclusion: if you can take advantage of promotional rates, by all means, go for it. You don't owe them any favors. Enjoy it as long as it lasts. Remember, the card company gets a percentage at the time of purchase, as well as any interest you let them collect from you. Yes, they're still making a profit on our accounts, and they can always hope that at some point we'll run up a high enough bill to be willing to pay some interest. They may kill completely inactive cards, since they need a bit of income to pay for processing the account. But if you're actively using it, they aren't very likely to tell you to go away (though they may change which plan(s) they offer you). Credit card companies are businesses. Businesses will make any decision that makes them money. So does it make them money to cancel your account? It's a simple cost-benefit analysis: you having an account with them will probably give them some benefit for very little cost to them. The only real cost associated with an open account is someone who uses the card but doesn't pay, but they're pretty sure you won't be doing that. "I would think it extremely unlikely that an issuer would cancel your card for having an ADB of approximately zero. The issuer charges the vendor that accepts a card a percentage of the transaction (usually up to ~3%, AMEX is generally higher) - so they are making money even if you carry no balance on your card (the specific language for various vendor-side (acceptor) credit card agreements boils down to ""we are essentially giving you, the vendor, a short-term loan and you will pay us for it). This why you see credit-card minimum purchase amounts at places like hot-dog stands - they're getting nailed on the percentage.  This is also why, when given the choice between ""Debit or Credit"" for a particular card, I choose where to put the hit on the company I like less - the retailer or the bank." "Speaking from personal experience: I have had a credit card canceled for exactly this reason. It's happened to me three times, with two different providers (NatWest and Nationwide). After the third instance I stopped bothering to even carry a credit card. It's worth noting that all three were ""free"" cards in the sense that I paid no flat fee or subscription to get the cards. The only way the issuer could make a profit on them was through interest. I was also not a frequent user, carrying the card for convenience more than anything else, although I did make purchases on all three. So it's certainly a possibility. But I live in the UK and I'm guessing most of your other respondents do not. It may be a practice that's more common here than in the US. That might even explain the origin of the rumour." Technically, yes but, in practice, no.  I use a card for everything and pay it off every month. Sometimes, several times a month depending on how the month is going. In the last 10 years, I've paid a total of $8 in interest because I legitimately forgot to pay my balance before the statement came out when I was out of town. I wasn't late, I just didn't beat the statement and had a small interest charge that I couldn't successfully argue off.  In the same time period, I've had one card cancelled at the banks request. The reason was that I hadn't used it in two years so they cancelled me.  I never pay annual fees, I get cards with great rewards programs and I (almost) never pay interest. If your bank cancels your card because you're too responsible, find a better bank. "When you buy something with your credit card, the store pays a fee to the credit card company, typically a base fee of 15 to 50 cents plus 2 to 3% of the purchase. At least, that's what it was a few years back when I had a tiny business and I wanted to accept credit cards. Big chain stores pay less because they are ""buying in bulk"" and have negotiating power. Just because you aren't paying interest doesn't mean the credit card company isn't making money off of you. In fact if you pay your monthly bill promptly, they're probably making MORE off of you, because they're collecting 2 or 3% for a month or less, instead of the 1 to 2% per month that they can charge in interest. The only situation I know where you can get money from a credit card company for free is when they offer ""convenience checks"" or a balance transfer with no up-front fee. I get such an offer every now and then. I presume the credit card company does that for the same reason that stores give out free samples: they hope that if you try the card, you'll continue using it. To them, it's a marketing cost, no different than the cost of putting an ad on television." No, they won't cancel it because you pay your card on time.  When a company offers a promotion like that they are banking on making money on average, not in every case.  On average including all the benefits including transaction fees, deals for partnering with best buy, etc.  Of course some people pay their credit card in full each month and never incur interest charges.  However, credit card companies more than cover that with other people who aren't responsible.  If it wasn't worth while they would end the card program or change it. Credit card merchant fees are $0.15 - $0.40 per transaction plus 1.5-4% of the amount charged. Card issuers are competing to get to be the card in your pocket that you use on a daily basis. If you were a card issuer, wouldn't you like to get 1.5-4% of every transaction I make for the rest of my life? As a side note, ever since I became a business owner and saw how much we are all paying for credit card merchant fees, I've patronized a lot more cash-only businesses. The best ones pass the savings directly on to the consumer. Some years ago a call center operator told me a bit more than they probably should have.  They like to see a lot of money go through the card, but very little staying on the card. Yes, they make money on the interest but one card defaulting blows away the profit on a lot of other cards. The 3% take from the merchants is both reliable and up-front, not 6 months down the line when (and if) you pay the interest. So if you want to make your credit card company happy, pay your bills in full every month. I have credit far beyond my actual means because I run work expenses on my personal card, I was told they didn't care (and had already guessed) that it wasn't my money. The point was I was handling things in a way they liked. Not quite at Palladium status, but cards with $200 annual fees are mine for the asking, and I haven't paid interest since the early 1990's. I've got a card that I've had for about 25 years now.  The only time they charged me interest I showed it was their goof (the automatic payment failed because of their mistake) and they haven't cancelled it.  No annual fee, a bit of cash back. The only cards I've ever had an issuer close are ones I didn't use.
"This is most likely protecting Square's relationship with Visa/Mastercard/AMEX/etc. Credit card companies typically charge their customers a much higher interest rate with no grace period on cash advances (withdrawals made from an ATM using a credit card). If you use Square to generate something that looks like a ""merchandise transaction"" but instead just hand over a wad of banknotes, you're forcing the credit card company to apply their cheaper ""purchases"" interest rate on the transaction, plus award any applicable cashback offers†, etc. Square would absolutely profit off of this, but since it would result in less revenue for the partner credit card companies, that would quickly sour the relationship and could even result in them terminating their agreements with Square altogether. † This is the kind of activity they are trying to prevent:  1. Bill yourself $5,000 for ""merchandise"", but instead give yourself cash.  2. Earn 1.5% cashback ($75).  3. Use $4,925 of the cash and a $75 statement credit to pay your credit card statement.  4. Pocket the difference.  5. Repeat. Note, the fees involved probably negate any potential gain shown in this example, but I'm sure with enough creative thinking someone would figure out a way to game the system if it wasn't expressly forbidden in the terms of service" Nothing happens. A bank is a business; your relationship with the bank doesn't change because your visa or immigration status changes. Money held in the account is still held in the account. Interest paid on the account is still taxable. And so on. If the account is inactive long enough, abandoned account rules may apply, but that still has nothing to do with your status. I read Q#4 as  Will $250 in one account earn more interest than $250 in five accounts? in which case Excel says no, assuming a constant interest rate for all accounts. I dunno if the same holds true for banks. Trick question dude. Can't be done. Sorry to tell you. I've been hit with this. Credit card companies do not make money on these customers. Why does Amex have an annual fee on all cards and an abnormally large transaction fee for merchants? Because they don't allow you to carry a balance (On traditional cards). Meaning they don't make money on interest, like the customers in question here. Please realize that your issuer can close the account for any number of reasons.  Inactivity is one, as having a credit line open costs them money and if you never charge anything, the company doesn't get any transaction fees from vendors nor does the company get to charge you any interest. An occasional charge is likely to keep your card from being closed automatically, but it is not a guarantee. Another reason they may close the account is that you have other bad marks show up on your credit score, or their criteria for offering you the card change so you no longer match their target demographic. I have a credit card issued by my credit union that I have not used for a couple of years. They will not close the card account because my other accounts are still very profitable for them. If I were not an otherwise profitable customer, I wouldn't be surprised if they closed my credit card account. If you are serious about keeping the account open, you should probably have more than a trivial amount of usage. As noted above, this is likely going to need (several) lawyers to straighten out.  I am not a lawyer, but I think one should be retained ASAP. However, in the meantime: The authorized user should not be making any charges.  Continuing to do so at this point may be a criminal offense.  For the protection of any other heirs, this should be brought to the attention of the credit card issuer and law enforcement authorities.  As it stands, the account holder's estate will be liable for the full debt, and the authorized user's estate would be untouched.   Of course, all this could change if other heirs challenge the estate and file civil suits, in which case it's likely that both estates will be eaten up with legal fees anyway. There are three parties involved here: there's the store that issued you the card, then they have some bank that's actually handling the account, and there is some network (VISA, MasterCard, etc.) that the transactions go through. So one avenue to consider is seeing whether all three are aware of you canceling the card. "No. That's pretty unlikely. Card issuers typically base your rate on your credit score. Paying down debt reduces your percent of available credit used, and improves your score until you are in the 1-20% range. That's optimum. To this issuer, you are one of a million customers, there's no emotion in this, just numbers to them. For what it's worth, if a card issuer raises your rate, you are permitted to ""not accept"" the rate, stop using the card for new charges, and pay at the current rate. Of course this doesn't apply to zero interest deals, only to increases to your regular rate." "Whether or not the specific card in question is truly 0% interest rate for the first 12 months, such cards do exist. However, the bank does make money out of it on the average: Still, 12 months of not having to think about paying the bill. Nice. This is exactly what they want you to do. Then in 12 months, when you start thinking about it, you may find out that you don't have the cash immediately available and end up paying the (usually very large) interest. It is possible to game this system to keep the ""free"" money in investments for the 12 months, as long as you are very careful to always follow the terms and dates. Because even one mishap can take away the small profits you could get for a 12 month investment of a few thousand dollars, it is rarely worth the effort." The answer is the next sentence from the Wikipedia article: The precise manner in which interest is charged is usually detailed in a cardholder agreement which may be summarized on the back of the monthly statement.  Your previous question on credit card interest rates quotes the sentence after this. You have to review what the agreement for your card says. Also keep in mind the bank wants to make money from you. The more interest and fees they collect, they better they like you. If enough card holders adjust their behavior, to minimize interest and fees; the bank will then adjust the credit card agreement to get money a different way.  Yes, you are right it would seem fair to only charge interest on the smaller amount, but that doesn't allow the credit card issuer to maximize profits. Consider the following scenario at a small business: As a business owner I have 10k in the bank at the moment. I have a one time expense of 4k that will not directly impact the growth of my business. I can choose to pay the 4k out of the 10 in the bank and then put the rest towards business growth. Assuming a 10% annual return on capital at the end of this transaction I am left with $6,600. Now if instead I chose to pay the 4k with a business credit card I have that only carries a 7.9% interest rate what would happen is that I incur a 4k balance that I have to pay off in a year and put 10k towards my business. Now, this is a simplified case that does not take into account the effective interest on the card and the minimum monthly payments. That being said, what happens in the end of the year is that I owe $4316 to my credit card but I now have 11k  in the bank, due to business growth. That leaves me with $6,684 after a year's worth of operations, which is better than my original $6,600. This is a small scale scenario though, but the basic idea is that if you can put the money towards growth that is better than the interest you are paying to the card, you win. The risks of course include missing a payment and incurring a penalty, not being able to grow your money at the rate you thought, and so on. Hope this explains things a bit. If the bank wants to close your account, they will do just that. Having a small ongoing balance isn't going to prompt them to keep it open.  Typically, the risk is for a card with zero usage to be closed, as it's a cost to them to keep the account open, and it has no revenue. To avoid this, it's a good idea to use that card or cards for a regular purchase, say, gasoline. A non-impulse buy, and just pay in full to avoid interest. There's no need to keep a balance accruing interest.  Keep in mind - A bill contains a month of charges. The bill for December is issued on the 31st, but due January 25th or so. When you pay it in full you do not have zero balance, you have the charges from January. This accomplishes your goal, will no interest. Whether or not you have money in your account will not necessarily stop them withdrawing the money, and it certainly won't stop them attempting to withdraw the money. There are two possible scenarios when they attempt to withdraw the money (as they surely will): I think you are just lucky they haven't attempted the withdrawal yet. Put the necessary money into your account now if you possibly can, and consider this a slightly expensive lesson learned about following the Ts and Cs when cancelling services. "Understood. But based on the OP, it's not categorically clear what they were refusing.   If they refused to quote the balance and/or refused to take a phone payment that was otherwise in keeping with the cardholder agreement (i.e., the cardmember called the correct number for phone payments and balance-checking, etc), then yeah, they were not only being unreasonable, but also violating the contract.   What I read as ambiguous is whether the cardholder was specifically asking for the *payoff* balance/amount, and whether they were following process for phone-payments and balance-checking, etc.   IOW, it's not necessarily ""illegal"" and might not even be unreasonable for the customer-service number to have different departments for balance-checking and phone-payments versus card-cancellation. It's not falsifiably clear from the OP that the cardholder was not asking the person on the other end of the phone for categorical statements of fact that they were obligated to make.   I'm not accusing anyone of lying or saying that the CC company was acting reasonably, I'm just saying that language such as **""They do not provide mid-cycle payoff quotes""** is not evidence that they were doing any kind of funny-business." "There is no good proxy for VIX, because it is a completely made-up value. Most listed options trade on an underlying security.  I can therefore choose to buy either the stock, or a future or option on that stock.  In this way, the future and option are derivatives in that they derive their value (in part) based on something else, in this case the stock price as of now. VIX is a different entity altogether.  It is based on the volatility of the market, using ""market expectation of near term volatility conveyed by stock index option prices"".  But the FAQ goes on to state that they are adding factors into the formula. So right away there is no one equity/stock that you can hold that will necessarily match the VIX in any significant way, because it is not directly based on stocks, but indirectly through other options and computations. In effect, therefore, the VIX in indeed only available through its options, and is not observable (tradable) in and of itself."