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  1. Post
    #1

    Credit Card Interest Calculation

    Does anyone know how the bank calculate credit card interest?
    I've got an ANZ CC. The current balance is about 3000.00. I had $1600.00 due on 10 FEB but I forgot and only make the payment on 13 of FEB. They already charge $12.00 for the late payment fee.

    The question is: Do I pay interest for the 10-13FEB only or will they charge me interest for the entire month?

  2. Post
    #2
    You'll get the interest amount deducted soon enough. The $1600 amount will be from the previous month correct? So I'd be expecting a months worth of interest to be due. Adds up quick at CC rates!

  3. Post
    #3
    Fragluton wrote:
    You'll get the interest amount deducted soon enough. The $1600 amount will be from the previous month correct? So I'd be expecting a months worth of interest to be due. Adds up quick at CC rates!
    Yes from previous month. I guess I'll need to pay off the remaining amount owe to avoid paying too much interest.

  4. Post
    #4
    So long as you cover the $1600 you should be fine. Anything outside of that amount, excluding any fees etc, should be due at next payment. At least that's how I understand it. I got caught out recently when I forgot to set my payment up (too many other things going on). Silly mistake but oh well.

  5. Post
    #5
    From my previous experience, you will be charged a month interest on the $1600. Even a day late will get you a month worth of interest on the balance due.... You can call and see if they budge... Got off once with ASB as we spend a bit of money through the card every year..

    Also be mindful if you paid anything less than $1600 (i.e. $159 you will also get charged for the full $1600 interest.

  6. Post
    #6
    hamsap wrote:
    From my previous experience, you will be charged a month interest on the $1600. Even a day late will get you a month worth of interest on the balance due.... You can call and see if they budge... Got off once with ASB as we spend a bit of money through the card every year..

    Also be mindful if you paid anything less than $1600 (i.e. $159 you will also get charged for the full $1600 interest.
    This isn’t actually quite correct. You will not get a months interest on 1600, credit cards don’t work that way. Each transaction detailed in the statement is calculated separately. So if you spent $50 at new world on the 5th of January that would have interest charged from the date of purchase through to the date that transaction was paid off. What this means is you can’t just multiple the balance by the rate divided by 365 times the number of days. You instead have to calculate each day separately and determine the daily interest based on the running balance (plus ignore any transactions that were not included in your statement). It’s more complicated yes but much more accurate.