If a credit card overdraft has passed the interest-free period, you need to pay interest. If the minimum repayment amount is not reached, an additional late payment fee of 5 yuan will be paid, which is much higher than the interest. If this overdraft "maxes out" the card, an over-limit fee will be charged. However, starting from January 1, 2017, liquidated damages will replace late payment fees and over-limit fees will also be cancelled.

The People's Bank of China issued the "Notice on Matters Concerning the Credit Card Business" (hereinafter referred to as the "Notice"), which made new regulations on credit card overdraft interest, interest-free period, minimum repayment amount, fee collection, etc. , brought new changes to citizens’ lives.

Overdraft interest may be reduced. At present, the credit card overdraft interest rate of various banks is generally 0.05 per day. The "Notice" cancels the current unified credit card overdraft interest rate standards and implements upper and lower limit range management of overdraft interest rates. The upper limit is 0.05 daily interest rate and the lower limit is 30% of the daily interest rate 0.05. After the new regulations are implemented, citizens can compare multiple banks for credit cards and choose a bank with a relatively low overdraft interest rate.

The bank can determine the interest-free period and minimum repayment amount at its discretion. According to relevant regulations, the current interest-free period for credit cards is generally about 50 days, and the minimum repayment amount must not be less than 10% of the overdraft consumption balance of the month. The new regulations cancel the restrictions on the interest-free period and the minimum repayment amount. Each bank can decide the interest-free period and the minimum repayment amount based on its own situation and the credit status of the cardholder. This means that in order to improve market competitiveness, some banks may launch credit cards with ultra-long interest-free periods, and the minimum repayment amount may be lower. This is a good thing for cardholders.

The fee will be charged once and will not be compounded. The "Notice" stipulates that card issuers shall not charge interest on the liquidated damages, annual fees, cash withdrawal fees and other service fees collected from cardholders. At present, most of the interest calculation methods of domestic banks are compound interest, that is, compound interest, which may result in sky-high debts. This situation will no longer exist in the future, which is very beneficial to cardholders.