Whether a credit or debit card is used to make a payment at a merchant, there will be outflow of money from the bank. What extra benefit do the bank get from promoting credit more than debit card?
Is it just the obvious answer that by promoting credit card, there is a chance that user will default on the payment and allow bank to charge interest?
On the downside, by paying through credit card, the user still has money in her savings account and so from bank has to maintain higher reserve ratio with the central bank.
Finally, does it have something to do with the fee bank charges with merchants? Is the fee higher for use of credit cards as compared to debit cards?