Santa Claus comes around just once a year. In the meantime, there are Credit Cards.
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  • Why Paying Credit Card 'Minimum Payment Due' Does Not Help Reviews

    • HSBC Bank Credit Card
      "Good"
      0.5 4.0/5 "Great!"
      HSBC credit card is my least choice to prefer, which does not mean ,its not working good. I would like to say that the credit limit value is good one for me and I have stopped to use it for some long time. Offers are good one with them till now.
      Was this review helpful? 1
      , pune
      Reviewed on Jun 22, 2017
    • ICICI Bank Credit Card
      "Excellent"
      0.5 5.0/5 "Blown Away!"
      My best credit card is the ICICI bank one because I can merge everything with this credit card . I had been with them for some long time. Customer service is good, while it comes to matter of on time settlement. I have never faced the penalty charges till now , also the offers are up to the mark .
      Was this review helpful? 0
      , pune
      Reviewed on Jun 22, 2017
    • Citibank Credit Card
      "Nice credit card"
      0.5 3.0/5 "Satisfactory"
      I took credit card loan from CITI Bank, I approached the loan through online there is an option to afford pre approved credit card loan and they gave nominal interest rate. Apart from that, I am getting some reward points for the credit card transactions, I am fine with the credit limit as it is very much satisfactory.
      Was this review helpful? 1
      , chennai
      Reviewed on Jun 22, 2017
    • Bank Bazaar Customer Support
      "Very Good "
      0.5 4.0/5 "Great!"
      Bank Bazaar. Com is very good, it is very easy to fill all columns and it is very clear and fast we don't have to wait for otp number I will also download app now and I will use now bankbazaar and we can know our cibil score very fast and also about my loan too,.
      Was this review helpful? 0
      , mumbai
      Reviewed on Jun 22, 2017
    • Bank Bazaar Customer Support
      "Bankbazaar an easy way to financial solution"
      0.5 4.5/5 "Excellent!"
      Awesome, Free of Cost, sitting at one place and without loosing time can solve all financial needs with the help of Bank Bazaar. Thanks to BankBazaar for such wonderful service which is really helpful to the common man and also the site is very beautiful and easy for anybody to use.
      Was this review helpful? 0
      , mumbai
      Reviewed on Jun 22, 2017
    • Bank Bazaar Customer Support
      "Very good "
      0.5 4.5/5 "Excellent!"
      My experience with the this company is very good, so easy to apply. I am very happy. It is time saving and very easy to use. Bank bazaar is very good application and bank bazaar team is very very supportive and good. I have wonderful experience with bank bazaar team. Thanks
      Was this review helpful? 0
      , new delhi
      Reviewed on Jun 22, 2017
    • Standard Chartered Bank Credit Card
      "Offers are good"
      0.5 5.0/5 "Blown Away!"
      I hold a life time free credit card with Standard Chartered bank. I have no issues in using this product with the bank. There are continuous calls and there are offers as well. The online banking is good and very much helpful as I can make my payments online and check on my transactions.
      Was this review helpful? 0
      , pune
      Reviewed on Jun 22, 2017
    • HDFC Bank Credit Card
      "Convenient for transaction"
      0.5 4.0/5 "Great!"
      I am using HDFC credit card for five years, I am working with TCS, hence they are giving some special offers for the credit card. I used to get some reward points and cash back for kinds of transaction. I am fine with the credit limit is satisfactory.
      Was this review helpful? 0
      , chennai
      Reviewed on Jun 22, 2017
    • Axis Bank Credit Card
      "Good benefits"
      0.5 5.0/5 "Blown Away!"
      Axis Bank has offered me a credit card and I am happy with the process in getting the card. They have given me a decent credit limit. It is a life time free card and the customer services has always been great, because they are responsive when ever I reach out to them.
      Was this review helpful? 0
      , pune
      Reviewed on Jun 22, 2017
    • SBI Cards Credit Card
      "Scope for improvement"
      0.5 3.0/5 "Satisfactory"
      SBI credit card is the one, am using from the last two years of time. Credit limit value could be get improvised like its really not beneficial for me. Whole scenario was not really made me to get satisfied about the process, also they used to take much time to resolve any issues.
      Was this review helpful? 0
      , guwahati
      Reviewed on Jun 22, 2017
    • ICICI Bank Credit Card
      "You should beleive it"
      0.5 4.0/5 "Great!"
      I want to mention ICICI bank credit card is my first choice because their interest rate is very lesser one for the minimum amount payment. Customer service and all is absolutely good. Online services are also an awesome one like its very clean and clear.
      Was this review helpful? 0
      , guwahati
      Reviewed on Jun 22, 2017
    • HDFC Bank Credit Card
      "Best"
      0.5 4.0/5 "Great!"
      I do hold a credit card of HDFC bank with the credit limit of 1.5 lakh Rupees. Customer service is the best one for me and I am not running behind the offers. I had not faced the drawbacks with them till now, also they used to delay with the phone banking service, which is not only with them.
      Was this review helpful? 0
      , chennai
      Reviewed on Jun 22, 2017
    • Standard Chartered Bank Credit Card
      "Best one"
      0.5 5.0/5 "Blown Away!"
      I am using Standard chartered bank credit card from the last three years of time, also the customer service is a good one. Online services are also good one , also the payment was not delayed till now. Credit limit value is good one with them and it is good.
      Was this review helpful? 0
      , chennai
      Reviewed on Jun 22, 2017
    • HDFC Bank Credit Card
      "Average card to use"
      0.5 2.0/5 "Expected more"
      Recently I have started using HDFC bank solitaire premium credit card. I have applied for HDFC bank money back card, but I am not sure, why they have issued the solitaire premium card. The credit limit with HDFC bank can be increased in future. This card doesn't have annual fee in the first year, from 2nd year onwards If we use more than 50 k or 1lakh the annual fee will be waived off. I would say, it is an average card to use.
      Was this review helpful? 0
      , bangalore
      Reviewed on Jun 22, 2017
    • Kotak Credit Card
      "Average card to use"
      0.5 1.0/5 "Really Bad"
      I got Visa credit card with Kotak Mahindra. I hold this card for past 1 year. I don't get credit points, reward points,cash back offers with this card. I don't use this card even for shopping as well. The rate of interest is high when compared with others. The credit limit can be increased in future. The banking and the customer service need to be improved with Kotak Mahindra bank.
      Was this review helpful? 0
      , bangalore
      Reviewed on Jun 22, 2017
    • SBI Cards Credit Card
      "Good Service"
      0.5 5.0/5 "Blown Away!"
      I availed chargeable credit card from State bank of India. The annual charges are 500 rupees. Also the credit limit offered by the bank is pretty good and satisfactory according to the requirement. I do receive reward points and cash back offers from the bank.
      Was this review helpful? 0
      , gurgaon
      Reviewed on Jun 22, 2017
    • ICICI Bank Credit Card
      "Very good services"
      0.5 5.0/5 "Blown Away!"
      I hold a credit card with ICICI Bank and the offers on the card is perfect. It is nice to get these deals and I am also informed about it as well. There are emails and messages sent on a regular basis. I also get intimated when ever I use my card. Nice experience.
      Was this review helpful? 0
      , bangalore
      Reviewed on Jun 22, 2017
    • American Express Credit Card
      "Not Satisfactory"
      0.5 1.0/5 "Really Bad"
      I have used a credit card with Amex Bank and I am not happy with this bank. The charges are high and the offers are also not to my satisfaction. It has not been a good experience. The customer services is also average. There are no benefits at all on the card.
      Was this review helpful? 0
      , jaipur
      Reviewed on Jun 22, 2017
    • IndusInd Bank Credit Card
      "Such a waste useless INDUSIND credit card."
      0.5 1.0/5 "Really Bad"
      Indusind bank people call and tell the customer that they are giving free credit card(No yearly & processing fees). But they levy charges in card statement of first month around 1000. Their customer service won't respond. And most importantly they never give offers on online purchases like AMAZON & FLIPKART. Is there any rating less than one star? I want to give 1/2 star for this card.
      Was this review helpful? 0
      , secunderabad
      Reviewed on Jun 22, 2017
    • HDFC Bank Credit Card
      "Not Satisfactory"
      0.5 1.0/5 "Really Bad"
      I am unhappy with the credit card experience with HDFC Bank. They need an improvement in every bit of the process. They had not given me a proper limit, neither are their offers on the card nor are my statements were on time and clear. Overall I am unhappy with them.
      Was this review helpful? 1
      , jaipur
      Reviewed on Jun 22, 2017
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    Why Paying Credit Card 'Minimum Payment Due' Does Not Help is Rated as "Excellent!" by 35747 Users

    Fees & Charges

    Promised Interest Rate

    Customer Service

    Responsiveness

    Credit Card BYTES FROM OUR KITCHEN

    Sometimes, it just happens that we make a lot of impulse purchases throughout the month and when we receive the credit card bill, the cash flows are stretched already. In such scenarios, we would not be always able to pay the total outstanding amount in entirety. Also, any balance that remains unpaid for the month accumulates high interest. In times like these, the “Minimal Amount Due” or famously MAD, can be our saviour. Minimum Payment means that it is a small fraction of the total outstanding amount that you can pay in case you are not able to make full payments. So, what is minimum amount due or the minimum payment amount? What is its advantage? Read on to find more about the same.

    Advantages of Paying the Minimum Amount Due:

    Here are some of the advantages of paying the minimum due every month.

    • The Minimum Amount Due (MAD) is the amount that you pay to the concerned credit card company on or before the due date to keep your credit card active and to keep the card account operative.
    • Making the Minimum Amount Due Payment will ensure that you will have to pay only the interest when required. There will be no penalty or late payment charges.
    • Your Credit Card Company or credit card issuing bank will not report you as irregular to credit bureau if you make Minimum Amount Due Payments on time.
    • If you do not make credit card payments on time, your credit score will be adversely affected. To avoid this, you can pay at least the minimum amount due as mentioned in your credit card bill on time.

    Calculation of Minimum Amount Due:

    As is the case with many credit card companies, the Minimum Amount Due is generally 5% of the balance outstanding as calculated on statement date. If you have converted your purchases to EMI or if you have enabled the EMI balance transfer option, the same will also be added to your Minimum Amount Due. Also, if there are any unpaid Minimum amount from the previous credit card statement cycle, it will also be added to the minimum due for current month.

    Let us consider an example for minimum amount due calculation and make some assumptions for the same.

    • The fee for late payment is Rs. 500.
    • The credit card statement is generated at the 5th of every month.
    • Interest rate is charged at 3% every month
    • The payment is to made on or before 26th of every month.

    The following example will show how the minimum amount due is calculated.

    Date

    Transaction Details

    Transaction Amount

    Remarks

    July 15

    Purchase

    Rs. 10, 000

    Interest Free Credit period.

    August 5

    Statement

    Rs. 10, 000

    Due date is August 26. Minimum Amount Due is Rs. 500 (5% of Rs. 10, 000)

    August 20

    Payment

    Rs. 500

    Minimum Amount Due Payment

    August 25

    Purchase

    Rs. 15, 000

    No interest free credit period

    September 5

    Interest

    Rs. 682

    On purchase

    September 5

    Service Tax

    Rs. 95

    Service tax on interest

    September 5

    Statement

    Rs. 25, 278

    Minimum Amount Due is Rs. 1263.90 (5% of Rs. 25, 278)

    September 26

    No payment is made. Late payment fee will be applicable.

    September 30

    Late Payment Charges

    Rs. 684

    Including service charges.

    October 5

    Interest Charges

    Rs.. 778

    October 5

    Service Tax

    Rs. 109

    Service tax on interest

    October 5

    Statement

    Rs. 26, 848

    Minimum amount due Rs. 2,542 including the previous due of Rs.1, 263.9

    The fact that late payment penalty was not charged in August since the minimum amount has already been paid is obvious. Also, the interest has been charged on the amount unpaid from the purchase date and not from the due date or statement date. Hence, by making the minimum due payment, you cannot avoid the high interest. Also, if you do not make the minimum payment by due date, late payment penalty will also be charged.

    Disadvantages of Paying only the Minimum Amount Due:

    • One major advantage of making regular, full payments of your credit card outstanding is that you get interest free credit period for up to two months. Not only that, you will also get up to three weeks’ time to clear the outstanding amount after statement is issued.
    • You will not be offered any interest free credit period if you have paid only the Minimum Amount Due (MAD) and not the credit card outstanding in full. Rather, you will be charged interest amount from the date of purchase.
    • The interest amount will also keep accumulating till you settle the dues. So, even if you have paid the Minimum Amount Due and have avoided paying any penalty for late payment, you will not be able to enjoy the benefits of interest free credit period.

    Consider an illustrations to see how interest is charged on credit cards and how paying just the Minimum Amount Due every month will lead to accumulation of interest,

    Date

    Transaction Details

    Transaction Amount

    Remarks

    July 15

    Purchase

    Rs. 5, 000

    Interest Free Credit period

    July 30

    Purchase

    Rs. 5, 000

    Interest Free Credit period

    August 5

    Statement

    Rs. 10, 000

    Due Date - August 26

    Minimum Amount Due is Rs. 500 (5% of Rs. 10, 000)

    August 8

    Purchase

    Rs. 8, 000

    Interest Free Credit period

    August 20

    Payment

    Rs. 10, 000

    Full Payment

    August 25

    Purchase

    Rs. 15, 000

    Interest Free Credit period

    September 5

    Statement

    Rs. 23, 000

    For bills on August 8 and August 25

    Due Date is September 4

    Minimum amount Due (Rs. 1, 150)

    September 12

    Purchase

    Rs. 10, 000

    Interest Free Credit period

    September 26

    Payment

    Rs. 1, 150

    Minimum Amount Due paid

    Interest Free credit period for August 8, 25 and 12 will be reversed.

    Interest will be charged from the date of purchase.

    September 30

    Purchase

    Rs. 5, 000

    No Interest Free Credit period

    October 5

    Interest

    Rs. 1, 679

    Interest Charged for all purchases from date of purchase.

    October 5

    Tax

    Rs. 235

    Service tax on interest

    October 5

    Statement

    Rs. 38, 764

    Statement Amount Rs. 23,000 - Payment of Rs. 1, 150 + Purchases Rs. 15, 000 + Interest Amount Rs. 1, 679 + Service Tax

    From the above example, it can be understood that for bills on August 8, no interest was charged in the statement dated September 5. However, because only the Minimum Amount Due was paid, the interest free credit period was taken back and interest was charged.

    Can you just keep paying the Minimum Amount Due Every Month?

    Yes, you can keep your credit card active by paying just the Minimum Amount Due every month. But, you will have to pay high interest charges and also, there will be no interest free credit period. Just remember that the less you pay of the outstanding amount, you will be made to pay more in interest. Credit card debts are very expensive and you must always make credit card payments in full. When there’s a financial contingency or cash flow crisis in a particular month, you can have just paying the Minimum amount due as an option. You will avoid credit score hits and late payment charges by paying the Minimum Amount Due - but, this can only be a short term arrangement.

    In conclusion, you will have to cut down on expenses and revisit your budget if you constantly find yourself being able to pay only the Minimum Due amount. In case the credit card interest has become too much to bear, you can tru personal loans or balance transfer options.

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