The financial industry has changed a lot for the past couple of years. It was only a few years back when the first credit card was introduced to the people as a means to help them cope up with their daily expenses. Now, there are a number of companies out there competing with each other to be the best credit card company. But more than the benefits of having the credit card and other special quirks which comes along with signing up for one, competition mostly is about who has the better interest rate. As you are well aware of, these financial institutions make their money through interest. The idea here is that people who start revolving their balance will have to pay their balance plus any other interest on it. So as long they continue to not pay the whole amount of their balance, the credit card company will continue to earn extra through the interest.
Because of this, companies are then employing marketing strategies such as balance transfers. Balance transfers allow you to transfer all your balance on your credit card to another credit card of a different company. The idea here is that the credit card company offering the balance transfer promotion will be the ones to pay the remaining balance of the customer from the old credit card. The customer will then continue paying the balance transferred to the new credit card with the new interest rate offered by the opposing credit card company. It may sound simple but then again, you have to be very careful considering credit card companies’ offers.