Only one month's funds were used in the first phase, and the annual interest was paid once; The second phase is equivalent to spending two months of funds, seeking an annual interest, and then adding it all up.

annual interest rate = installment fee rate/(number of installments +1)*24 = single installment fee rate * number of installments/(number of installments +1)*24

Calculated by product 2 [.88%x 6/ 7] x 24 = 18.1%

For example, the installment fee is .88% and divided into 12. With the increase of repayment, the money owed to the bank decreases, but the handling fee will not decrease with the progress of repayment, which is different from the calculation method of interest on bank loans. ?

compared with the current benchmark interest rate of 6.31% for one-year loans, some people may think that the annualized installment fee rate of 6% for credit cards may not be high, but the actual fee paid is higher than the loan interest for the same period.

Extended information:

Suppose the installment amount is RMB 1,2, divided into 12 installments, and 1 yuan will be repaid in each installment (month). The handling fee is .6%/ month, and the actual monthly deduction is RMB 1+1,2× .6% = 17.2. If other factors are not considered, the convertible nominal annual interest rate is 7.2%. However, the cardholder does not always owe the bank 1,2 yuan. In the last month, he actually owes the bank 1 yuan, but the bank still charges a handling fee of 1,2 yuan.

according to the calculation, the real annual interest rate that the cardholder has to pay is about 15.48%. According to the correct calculation formula, it should be 12 * .6% * (1+.6%) 12/((1+.6%) 12-1) = 13.94 yuan, with an extra handling fee of 3.2% per period.

reference sources; Baidu encyclopedia-credit card installment payment