If you pay on time they still get the merchant fees that a merchant must
imbed into their selling price but they don't get the more lucrative
interest. If they have to pursue you for money then it costs them.
Carrying a balance and paying on time makes you a extra good customer
who earns a high score..

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Paying on time means paying what they ask (usually 5% of outstanding balance
plus interest per month), not paying off the entire balance at once. If you
pay off the entire balance every month or every billing cycle, they ain't
making money off you and you are not an extra good customer.