Credit Card payments 24 January at 1:02PM in Credit cards 5 replies 197 views

JimC2022

Hi All,
I hope you are well.

If I pay the more than the minimum will my minimum go up next month? or down? My CC is 1% of the balance and 19% APR.

MorningcoffeeIV

Your minimum is always the same calculation each month - eg 1% plus fees and interest. It all depends on your balance.

Ebe_Scrooge

Assuming you make no more transactions on the card then next month's minimum payment will go down.  Until you get close to paying it off in full - most cards have a minimum of "x% or £5, whichever is the greater".

Though you really should be aiming to repay in full every month, both for the sake of your credit history and to avoid paying interest.

Martico

Although if your minimum spend is only 1% and the APR is 19%, then your interest charge will exceed the monthly minimum and the balance (and future min payments) will continue to rise.
Pay as much as you can over the minimum amount, preferably clear the thing. Otherwise as Ebe says, you'll continue paying interest. Aim to clear it as fast as you can.

eskbanker

Martico said:

Although if your minimum spend is only 1% and the APR is 19%, then your interest charge will exceed the monthly minimum and the balance (and future min payments) will continue to rise.

Minimum repayments must reduce the monthly balance (excluding any new spend), as they're required to be at least 1% of the balance plus interest and fees, as per https://www.handbook.fca.org.uk/handbook/CONC/6/7.html

a firm must set the minimum required repayment under a regulated credit agreement for a credit card or a store card at an amount equal to at least that amount which repays the interest, fees and charges that have been applied to the customer's account, plus one percentage of the amount outstanding.

Martico

Thanks for the correction!