We’ll help you decipher the jargon around Card interest so you really understand how it works when it applies to Credit Cards.
What is Credit Card interest?
When you use your Credit Card, you are borrowing money – and will be charged interest unless you repay the full balance within the specified period. The amount of interest you will be charged depends upon:
When you receive your statements, the details of your purchases and the amount of interest you have been charged will be clearly displayed.
How is Credit Card interest calculated?
Interest is calculated on any unpaid balance from the due date of your previous month’s statement. It is applied to your closing balance at the end of each day and then added up to make the current statement.
Charge Card or Credit Card - what’s the difference?
A Charge Card is similar to a Credit Card in that they’re both convenient ways to pay for goods and services, with repayment delayed until the end of that particular statement period.
The main difference is a Charge Card requires you to pay off your balance in full each month, which means you cannot roll over your balance into the next month. With a Credit Card you have the freedom to pay off your balance all at once or over several months
Statement Period
The dates for which your statements are issued and report transactions for. Generally, your statement period will be every 30 days, and actual dates can vary slightly from month to month.
Interest
Type of charge incurred as a result of borrowing money and not repaying in full within the indicated time. Interest is usually expressed as an annual percentage rate, also known as the interest rate.
Closing Balance
The amount you owe at the end of a particular statement period.
Credit and Charge Cards Explained
Has talk of interest, annual fees, rates and percentages left you feeling confused?
Our simple Credit and Charge Card guides are a great place to start.
How Credit Cards and Charge Cards work
Where is American Express accepted
What Credit Card fees am I expected to pay
How to apply for a Credit Card
