Understanding Credit Card To pay early and avoid Fines

Understanding credit card to pay early and avoid fines.

Real example if you don’t try to understand and just keep on paying Minimum Amount Due

Purchased product of – 15000

Ended up paying extra – 15000 because of fines and charges in period of 18 months


How to pay and avoid the charges that are applied and avoid it

There are various terms that need to be understood with the credit card those are as follows

  1. Total amount due
  2. Minimum amount due
  3. Statement date
  4. Minimum amount due payment date


  1. What is Total amount due

The total amount due is basically the total amount that you have to pay till date to just clear you banking credit card bill entirely. if you pay that amount completely that your debt of the card will become nil and you won’t be charged anything from the next statement date


  1. What is Minimum Amount Due

Minimum amount Due is just the Minimum Amount that you have to pay every month that banks asks it is based on the amount you have taken form the bank . Now if you go on carrying the amount for a long period of time by just paying minimum amount to the bank that does not mean the you are just paying from the total amount you are paying . You will end up paying twice or thrice or for how long you just keep paying your amount i.e. minimum amount due until you totally nil the debt remaining


Let’s consider the example below

1 .  Scratched am amount of 15000 from bank

Banks statement is as follows for the next month

Amount took

Financial cess charge



Minimum Amount due







Note – These are not the exact charges of figures that I a quoting these are just a rough figures to give you an idea about it .



So with above table you will probably get a rough idea what all charges you will be applied by the bank and there are not fines its just the extra amount that the take from you because you are using their money. It goes on until you finally pay the entire amount taken by the bank.


  1. You forgot to pay the Minimum Amount Due on the date specified by bank

Bank charges would be as follows for next month statement     

Amount Took

Financial Cess




Minimum Amount Due







With the above statement you can see if you fail to pay the Minimum amount Due before the date specified you will be charged 700 or whatever bank charges for late payment in the next month . so your next month amount to be paid will be addition of amount you took + all additional charges and fines .


  1. Statement date

It is the date bank releases monthly statement with information of amount due extra charges you have to pay etc.  It’s very important to go thoroughly details of the statement every month

  1. Minimum amount due payment date

Now this is very important it is the date where you have to pay at least that minimum amount to avoid the extra fine for nonpayment of the minimum amount .



How to use credit card smartly and avoid any charges of credit card

Consider your statement date is 4th of every month

  1. Avoid shopping close to the statement date if you don’t have the cash to pay the bank that time itself. Because if you shop suppose on 3rd of that month and don’t pay bank till 4th you will be charged with bank fees in addition to the amount you took.
  2. Wait for the statement date to go and then buy your product if you want time to pay back to bank
  3. If you don’t have cash even after purchasing from credit card always try to pay minimum amount due at or before the date specified by bank to pay minimum amount due to avoid additional late fees by bank .
  4. Always keep a habit of checking the statement of saving ,credit, debit etc. monthly and don’t just leave it
  5. Suppose you use credit card on 5th of the month and pay before 4th of next month you wont be charged with and fines of bank charges . if your bank might be charging small amount for using credit card you may be charged other than that no worries ……


Hope you understood what I wanted to explain . if you feel there are certain changes to make or have other doubts do feel free to leave the info down below in the comment section and I will try to answer as many as possible …

Happy Banking from istams.com

Post Author: anjumis