The calculation method of credit card overdraft interest involves the use of daily interest rates and monthly compound interest. Usually, the daily interest rate is 0.0005. To calculate the monthly interest rate, simply multiply the daily interest rate by 30, or 15/50,000 times 30 equals 1.5. The annual effective interest rate is calculated on a monthly compound basis, which means that each month's interest will be added to the next month's principal to form new interest. Therefore, the annual actual interest rate can be obtained by the formula (1-month interest rate)^12-1. In this example, it is (1 0.015)^12-1, and the calculated result is 19.5618. To put it simply, if your credit card overdraft interest is compounded monthly, the actual annual interest rate will be about 19.56 higher than the nominal 1.5. This is how the annual effective interest rate on a credit card overdraft is calculated.