If I asked you to describe the profile of the riskiest (most likely to default) credit card borrower, what would you say? Would you say things like they pay their bills on time, revolve small balances, and never approach their credit limits? Or, would you describe them as maxing out their card, missing payments, and exceeding their credit limits? Clearly, the latter is going to be the riskiest profile.
Now, describe to me the profile of a credit card user who is going to be the most profitable to the issuer. Would you say things like they pay their bills on time, revolve small balances, and never approach the credit limits? Or, would you describe them as maxing out their card, missing payments and exceeding their credit limits? Again, the latter is going to be the most profitable to the issuer.
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