Return to site

IMPORTANT FACTS TO KNOW ABOUT CREDIT CARD INTEREST RATES

· Credit card

If you are using a credit card, then you must be aware about the credit card interest rates and will be eager to know anything that can help you reduce it.

broken image

The credit card interest is levied in two situations:

a) When you pay only the minimum payable amount due on the bill.

b) When you pay less than the total amount due amount on the bill.

Following are some important things to know:

1. No interest is charged if you are starting from the zero balance.

2. No interest is charged on the remaining balance with 0% promotional APR.

3. Each lender has a different APR and MRP (Monthly percentage rate).

4. APR and MPR are likely to vary with the same lender in case of different card categories.

5. Interest is charged only when you do not pay the entire outstanding amount. So, if you pay in full, then no interest will be charged.

6. Cash withdrawal from ATMs through credit cards is also charged with interest.

7. The calculation of interest on credit card balance is done based on the annual percentage rate.

8. The monthly percentage rate applied each month by NBFCs and banks depends on the APR applied.