Priyanka Personal Finance
Smart Money · Simple Words · India
Smart Money · Simple Words · India
Paying only the "minimum due" on your credit card is a debt trap. At 36–42% a year, a small balance can take years to clear and cost you almost as much in interest. See the shocking numbers — and how fast you clear it by paying more.
Estimate only · Not financial advice · Assumes no new spending & a constant rate · Minimum-due formulas vary by bank · Actual cost depends on your card terms
Indian credit cards charge roughly 36–48% a year — about 3–4% every month — on any balance you carry. The "minimum amount due" is usually just 5% of the balance. Since most of that 5% goes toward interest, the principal barely moves. Pay only the minimum and a ₹50,000 balance can take years to clear, with interest that rivals the original amount. It's one of the most expensive forms of debt in India.
Credit cards are only "free" if you clear the full bill by the due date. Do that and you get up to ~45–50 days of interest-free credit and rewards. The moment you carry a balance — or take a cash advance — interest kicks in immediately, often from the transaction date, with no grace period. Discipline turns the card into a tool; the minimum-due button turns it into a trap.
Credit cards in India charge around 36–48% per year (about 3–4% a month). The minimum due is usually only 5% of the balance, so most of it just covers interest and the principal barely falls. A balance can take years to clear and you can end up paying almost as much in interest as the original purchase.
Most Indian credit cards charge roughly 3.0–3.75% per month on revolving balances, which is about 36–45% a year. Cash withdrawals and some cards can be even higher.
Pay much more than the minimum — ideally the full statement each month. If the balance is large, consider converting it to EMI (lower rate), a personal loan, or a balance transfer, and stop new spending on the card until it is cleared.
Yes. If you pay the entire statement balance by the due date every month, you pay zero interest and enjoy an interest-free credit period. Interest only starts when you carry a balance or take a cash advance.