What fees will be charged for overdue credit cards? You need to understand the calculation method

After we use a credit card to make purchases, we must remember to repay on time. Otherwise, overdue payment will not only affect your credit, but more importantly, it will also incur some fees. If you do not pay off the overdue balance in one day, you will be overdue. The costs will escalate. Here is a brief introduction to the overdue credit card fees and how to calculate them.

1. Credit card liquidated damages

Refers to when the cardholder fails to repay before the due payment date (inclusive) or the repayment amount is less than the minimum repayment amount, according to regulations The fee payable to the card-issuing bank is 5% of the unpaid portion of the minimum repayment amount. The fee is a one-time charge. Different banks can set upper and lower limits.

For example: Cardholder Xiao Liu spends 2,000 yuan with his card. If Xiao Liu only repays 500 yuan to the bank on the due date, if the bank stipulates that the minimum repayment amount is 1,500 yuan, then the bank will Liquidated damages will be charged for the portion lower than the minimum repayment amount: 1,500 yuan - 500 yuan = 1,000 yuan. The amount of liquidated damages is: 1,000 yuan 5% = 50 yuan.

2. Overdue interest

Refers to the interest-free repayment period confirmed by different banks after the cardholder uses a credit card to overdraft, and the cardholder does not repay the balance within this period. If the loan is taken, the cardholder will no longer enjoy the bank's interest-free treatment, and interest will be calculated at a daily interest rate of 0.5%.

One thing that needs special attention is that the amount calculated for an overdue credit card is not the amount owed, but the amount of consumption last month. For example, if Xiao Liu spends 2,000 yuan with a credit card, even if he has repaid 500 yuan, the credit card overdue interest will still be calculated based on the amount of 2,000 yuan.

So, try not to have an overdue credit card. Otherwise, if the consumption amount was large last month, it will be a scam if the base for interest calculation is too large.

How to calculate overdue interest on a credit card

1. How to calculate the interest on an overdue credit card

If a credit card is overdue for repayment, the interest will be divided into two situations:

1. The overdue interest on bank credit cards is generally 0.05% per day. The interest is calculated at an interest rate of 0.5% per day, and then compound interest is calculated at an interest rate of 0.05% until the cardholder pays off all until.

2. Interest will be accrued on the full amount of the overdue balance, and compound interest will be charged on a monthly basis until the cardholder repays it in full. Currently, if a credit card is overdue, the bank will issue agreed interest for 5 months based on the cardholder's failure to repay the minimum repayment amount for more than 3 months.

2. What to do if your credit card is overdue

1. Quick remedy for overdue credit card

(1) If you encounter an overdue credit card, you should immediately call the bank service number and explain that it is not the case. If there is malicious arrears, please pay the arrears in a timely manner.

(2) Under normal circumstances, banks will have a 3-day grace period. Once cardholders find that their credit card is overdue, please handle it immediately to avoid leaving bad records.

2. How to deal with bad records

(1) If the cardholder has left bad records in the bank, do not rush to cancel the card after paying the outstanding balance and explaining the situation. , once the card is canceled, the personal credit record cannot be updated, and the bad record will always be recorded in the bank, causing serious consequences.

(2) The correct approach is to continue to use this credit card and maintain a good credit record for at least 2 years. It will basically not have an impact on personal mortgages, loans, credit card applications and other businesses.

How to calculate overdue credit card fees

1. A credit card is a credit certificate issued by a commercial bank or credit card company to consumers with qualified credit.

2. The form of a credit card is a card with the name of the issuing bank, validity period, serial number and cardholder’s name printed on the front. 1. Consumers holding credit cards can shop or consume in specialized commercial service departments, and then the bank settles with merchants and cardholders, and cardholders can overdraft within the prescribed limit.

Third, the earliest credit card appeared at the end of the 19th century. In the 1980s, the British clothing industry developed so-called credit cards, and the travel and business sectors followed suit. But at that time, cards could only be used for short-term business credit loans, and the money still had to be repaid as needed, so there were no long-term defaults and no credit limit. In the 1950s, McNamara, a credit expert in Manhattan, was having dinner in a restaurant. Because he didn't bring enough money, he had to ask his wife to send it over.

This made him feel very embarrassed, so he organized "DinersClub" (English: DinersClub). Members bring a meal card to 27 designated restaurants where they can collect their fees instead of paying cash. This is the earliest credit card. Franklin National Bank was the first bank to issue a credit card, and other U.S. banks followed suit.

It is said that one day, American businessman Frank McNamara was entertaining guests in a hotel in New York. After the meal, he found that he had forgotten his wallet. He was deeply embarrassed and had to call his wife to bring cash to the hotel to settle the bill. So McNamara came up with the idea of ??starting a credit card company. In the spring of 1950, McNamara and his friend Schneider invested US$10,000 to establish Diners Club in New York, the predecessor of Diners Club. Laidashe provides members with a card that can prove their identity and payment ability. Members can use the card to record accounts and make purchases. This kind of credit card that does not require a bank to handle is still a commercial credit card.

4. Another way to say credit card is that credit card is a non-cash transaction payment method and a simple credit service. Credit cards are generally plastic cards with a length of 85.60mm, a width of 53.98mm, and a thickness of 1mm. They are issued to cardholders by banks or credit card companies based on the user's creditworthiness and financial resources. Cardholders do not need to pay cash when using a credit card, and repayment is made on the billing day. Except for some credit cards that are combined with debit cards, general credit cards are different from debit cards and ATM cards in that credit cards will not directly debit the user's account. In February 2012, the bank confirmed that credit cards without passwords are more secure, and if stolen, they will share the responsibility with the bank. Enjoy the 25-56 days (or 20-50 days) interest-free period. Credit card consumption enjoys an interest-free period, and the bill amount is paid off before the due payment date without incurring any fees. There is no interest-free repayment period for cash withdrawals. From the date of cash withdrawal, interest of 0.5% will be charged every day, and the bank will also charge a certain percentage of cash withdrawal fees.

That’s it for the introduction of how to calculate overdue credit card fees.