Banks push credit cards and personal loans because they are highly profitable, help banks manage risk and liquidity, and support broader customer relationships that drive cross-selling across products. Here’s a concise breakdown of the main reasons and how they work in practice. What motivates banks

• Profit from interest and fees
  • Credit cards typically carry higher interest rates than many other forms of debt, especially when balances are carried month to month. Even when not carrying a balance, annual fees, late fees, and other charges add to revenue. Personal loans also generate interest income, often with fees for origination and service. This combination creates a strong, recurring revenue stream for banks. [General banking profitability concepts; typical interest-rate spreads]
• Balance sheet and liquidity management
  • Lending converts deposited funds into assets with higher returns. By offering a mix of card loans, personal loans, and other credit products, banks manage risk, diversify income, and optimize funding needs. This is why they actively market and extend these products to customers. [Banking operations overview]
• Cross-selling and relationship banking
  • A customer with a card or loan is more likely to open savings accounts, investment services, or additional credit products later. This deepens the bank’s relationship, increases overall profitability per customer, and reduces the likelihood the customer services are handled by a competitor. [Customer relationship management basics]
• Data and product ecosystem benefits
  • Card usage and loan activity generate rich data on spending, repayment behavior, and creditworthiness. Banks leverage this data to tailor offers, manage risk, and price products more effectively, which reinforces the incentive to maintain active marketing and onboarding programs. [Consumer credit dynamics]
• Risk management advantages
  • Diversified product exposure allows banks to spread risk across different asset types and customer segments. While every product carries risk, a balanced portfolio can help stabilize earnings and capital requirements over time. [Credit risk management fundamentals]

Common customer-facing reasons you might be targeted

• Pre-approved offers and affinity marketing
  • Banks use data to identify opportunities for pre-approved offers and cross-sell based on your profile and past interactions. This targeted approach often translates into mailing, online, and in-branch promotions. [Marketing practices in banking]
• Short-term financing needs vs. long-term debt
  • For smaller, immediate purchases, credit cards can be convenient; for larger, planned expenditures, personal loans may appear attractive due to structured repayment and potentially lower total interest than carrying a balance on a card. Banks present both options to capture different borrowing needs. [Consumer credit options overview]

How to evaluate offers for yourself

• Compare total cost
  • For credit cards: consider annual fees, introductory APR, ongoing APR, balance transfer terms, and penalties. For personal loans: compare interest rate, origination fees, and total repayment amount over the term. [Personal finance guidance]
• Assess your own behavior
  • If discipline with timely payments is strong, a card can offer rewards and flexibility; if a fixed repayment plan is preferred, a loan can provide predictable payments and possibly lower total interest. [Behavioral finance considerations]
• Consider relationship value
  • Having multiple products with the same bank can simplify management and may yield favorable terms, but unnecessary products add clutter and cost. [Banking relationship considerations]

If you’d like, I can tailor this to your situation (e.g., whether you should focus on a card for rewards vs. a personal loan for a major purchase) and compare typical costs for your region or credit profile.