In the last two decades, the trend of plastic money increased exponentially. Nowadays, most working professionals carry more than one debit and credit card. You fill out one form of credit card, and you start getting calls from multiple banks for their credit card. In a nutshell, owning a credit card is easy.
You must understand things related to credit card bill payments. There are two types of dues on your credit card. One is the minimum amount due, and another is the total amount due. Let’s understand them.
Minimum Amount Due
The minimum amount due is 5% of your total amount due. You can see in the image below.
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Total Amount Due
The total amount due is the amount that you have spent in the current billing cycle. It comprises all the amounts that you have paid from your credit card in the billing cycle.
Always pay the total amount due on your credit card
The interest rate on credit cards is enormous. You should pay the total amount due to your current bill cycle. Otherwise, the bank will charge interest on the remaining amount if you pay the minimum amount or any amount lower than your total amount due. The interest rate on the credit card will vary depending on which bank credit card you are using. I have used credit cards of 5 different banks ICICI, SBI, HDFC, RBL, and IndusInd. More or less, the interest rate is the same on all credit cards.
Depending on your uses, you might get rewarded by the bank, but the late fine on the delay of payment and remaining payment interest rates are the same. On average, banks charge a minimum interest of 2% up to 4%. The precise interest rate number you will get on the respective bank’s credit card website.
You can check the above image. I paid financial charges of 2880 INR on my HDFC Diner club credit card. You can also read small font text. Interest is charged on the reducing balance method.
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