Why Banks Really Offer 0% Credit Cards: Insights from Dr. Pinto

Dr. Joann Pinto, a professor at Montclair State University’s Feliciano School of Business, contributes an expert perspective on why banks offer 0% credit cards. According to Pinto, these promotions are strategic for banks as they still collect fees from merchants and charge about 4% for balance transfers, while also using them as incentives for loyal customers. She cautions cardholders to be mindful of the introductory period’s end, as interest rates can rise significantly. Pinto also addresses the broader question of whether 0% credit cards encourage debt, asserting that debt is not inherently immoral if managed responsibly.