The real cost of carrying a credit card balance
Credit cards are interest-free only if you pay the full bill. Pay less, and interest at around 3.5% a month — over 40% a year — plus 18% GST quietly piles up. This credit card interest calculator shows how long your balance will take to clear if you pay just the minimum due versus a fixed amount every month, and exactly how much extra you'll pay.
How to use it
- Enter the outstanding balance and the card's monthly interest rate (shown on your statement as “finance charges”).
- Enter the minimum due percentage (often 5%).
- Enter a fixed monthly amount you could pay instead, and compare.
Example
A ₹50,000 balance at 3.6% a month, paying only the 5% minimum each month, takes about25 years to clear and costs roughly ₹1.97 lakh in interest and GST — almost four times the original amount. Paying a fixed ₹5,000 a month clears it in 13 months for about ₹12,900. Converting the balance to an EMI or a personal loan at a lower rate can cut the cost further; compare with theEMI calculator.
Smart card habits
- Set up auto-pay for the total amount due, not the minimum.
- Keep spending below 30% of your limit to protect your credit score.
- Avoid cash withdrawals on credit cards — interest starts immediately, plus a fee.
Disclaimer: Results are estimates for educational purposes only and are not financial, investment or tax advice. Please verify with your bank, broker or a SEBI-registered adviser before acting. Read the full disclaimer.