Credit cards are much ahead of debit cards. Having a credit card has a lot of benefits. Hence it is always recommended to have one. In this article, you can read about Credit Card Interest rates
In the beginning, it might look a bit complicated to deal with, but if you are clear on certain things, it’s the best thing for you.
Today we shall discuss one such topic to make the journey yours with a credit card easy. The topic of the day is Credit Card Interest rates.
The first important piece of information is if the credit card you use has an annual percentage rate (APR) of 15%, it doesn’t mean they will charge 15% of interest. The interest rate of your credit card depends on the way you use it; it could be as high as 20% and as low as 0%. This is because they calculate the interest rate daily. Let’s jump into how the issuers calculate the interest rate.
How is the credit card interest calculated?
There are four steps to calculate the interest of the credit card. They are –
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Conversion of annual rate to the daily rate
– You need to divide the APR by 365 to get the annual rate. This way of calculating the interest rate is called the periodic interest rate.
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Determine the average daily balance
– The interest rate calculated depends on your balance on each of the days of the billing period.
Your calculation of the interest rate starts with the unpaid balance of the last month. The balance goes up when you make a purchase, and when you make a payment, the balance goes down. You can go through the billing period by yourself to calculate the balance.
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Put it together –
When you are done calculating the average daily balance, you need to multiply it by the number of days in the billing period.
Now, the interest will be calculated depending on the daily interest rate.
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Calculate the interest charges
– It’s time to calculate the interest charges when you have calculated both your average daily balance and daily rate. You can do this by multiplying your average daily balance by the daily rate and multiplying the amount by the days in your billing cycle.
Credit Cards have the strongest security in the market now. If you have a credit card, you will not need to think of theft or fraud.
In this article, we have discussed how you need to calculate your interest if you have a credit card, so you can get an idea of how to use your credit card smartly or how to calculate your credit interest charge. It’s simple. If you’re wondering how to check the details, you can go to the credit card login page and check all the details of your purchases and payment and other necessary information.
If you are looking for a credit card, there is no better option than opting for Bajaj Finserv RBL Bank SuperCard, they provide you with online and offline platforms to apply for credit cards at the simple steps, their website is user friendly where you can easily apply the credit card for instant approval. It is a new joint initiative by Bajaj Finserv and RBL Bank. It is a four-in-one card consisting of a loan card, credit card, cash card, and EMI card.
Along with many things, the SuperCard allows you to withdraw cash in an emergency without any hassle. This has benefits like no other card in the current market. It has some easy steps to get approval for the credit card, that too online.
You just need to log in and fill the application and upload the documents for KYC. The best thing about the card is that you can pay back the amount you use in Easy Monthly Installments.
