On May 26, the Postal Savings Bank of China issued an announcement on adjusting the penalty fees for early repayment of credit card installments.

The announcement shows that the Postal Savings Bank of China plans to adjust the installment liquidated damages charge to a maximum of no more than 3% of the remaining undistributed principal starting from May 27, 2023. For merchants that have collected installment payment fees in full, liquidated damages for early repayment of installments will not be charged. The adjustment to the service price list is announced as follows, and the specific charging standards shall be subject to the agreement at the time of application.

Service code: S0201005

Service: Installment payment

Service: Provide customers with installment payment business, installment prepayment, etc.

Applicable to: All credit card customers

Charging standards: 1. The installment handling fee is charged according to a certain proportion of the total installment payment. Fee collection methods include installment collection and one-time collection, and the rate for each period is 0-1.5 (one period per month). 2. If you cancel the bill installment and transaction installment, a cancellation fee of 20 yuan/transaction will be charged. 3. The penalty for early repayment of installments: the maximum shall not exceed 3% of the remaining undistributed principal. For businesses where the installment handling fee has been collected in full, no liquidated damages for early repayment of installments will be charged.

Preferential policies: The specific preferential policies are subject to the bank’s evaluation at the time of application. Customers can check through the official website.

Remarks: 1. The highest annualized interest rate for installment business conversion is 18.25 (the above rate is the annualized internal rate of return calculated based on the cardholder's cash flow simple interest. It varies depending on the situation, such as the selected installment product and bill date range, and the actual number of days per month , early repayment, cooperative merchants, etc.). 2. Handling fees can be charged to individual customers or merchants. 3. The specific charging standard for early repayment liquidated damages shall be subject to the local outlet announcement and the actual signed agreement.

National Business Daily Related Questions and Answers: Related Questions and Answers: Can I pay off my credit card in advance?

From any perspective, it is possible to pay off your credit card in advance without any problems

For those who are familiar with credit cards, they all know that one of the biggest problems with using credit cards is One is late repayment. So why does the questioner ask this question?

I think the questioner may not have clearly distinguished between credit cards and credit loans.

Credit loans generally have a fixed amount, a fixed repayment period, and corresponding interest on the use of funds needs to be paid.

But credit cards are different. Credit card funds have an interest-free period of up to 50 days. That is to say. As long as the cardholder does not adopt installment and minimum repayment methods, of course, he cannot make late repayments. Credit card funds are free to use. There is only a 50-day reimbursement period.

At the same time, there is the issue of credit card repayment. As long as the cardholder does not repay beyond the agreed last repayment date, the credit card can be repaid at any time, and the bank also allows it, and it will not have any adverse impact on the cardholder.

Of course, the only problem here is that if there are different repayment methods, there is a problem of whether it is cost-effective to repay the loan in advance.

1. Repay in full

Generally, if you repay in full, you will definitely enjoy the interest-free period of the credit card. As long as the cardholder has sufficient funds and repays the credit card bill after it comes out, there is actually no problem. Of course, if the cardholder does not have sufficient funds, it is also possible to repay the card when it is due on the bill date.

2. Installment repayment

Instalment repayment is generally agreed between the cardholder and the bank to divide the credit card bill into a fixed period of repayment, such as 3 months, 6 months, or even 24 months. For credit card installment repayment, the cardholder needs to pay installment fees to the bank. To put it bluntly, it is capital interest. Moreover, many banks will charge this fund interest in advance or in each installment of the bill. But there is a problem here. As long as the cardholder makes an installment, no matter whether the handling fee is collected in advance. If the cardholder repays the loan early within the specified period, the handling fee cannot be waived. So from this point of view, early repayment is definitely not cost-effective. Might as well keep the money on hand to try it out.

3. Minimum repayment

If the cardholder uses the minimum repayment method to repay due to temporary insufficient funds. If you have sufficient funds, you must remember to pay it back in advance so that it does not accumulate until the next billing date. Because the minimum payment is subject to full interest. If you don’t understand what full interest calculation means, you can search it online.