Credit Card Minimum Payment Calculator
By paying only the minimum amount due (starting at ₹5,000), you end up paying an extra ₹1,86,754 in pure interest over a span of 171 months.
Repayment Schedule (First 12 Months)
| Month | Payment Made | Interest Charged | Remaining Debt |
|---|---|---|---|
| Month 1 | ₹5,000 | ₹3,333 | ₹98,333 |
| Month 2 | ₹4,917 | ₹3,278 | ₹96,694 |
| Month 3 | ₹4,835 | ₹3,223 | ₹95,083 |
| Month 4 | ₹4,754 | ₹3,169 | ₹93,498 |
| Month 5 | ₹4,675 | ₹3,117 | ₹91,940 |
| Month 6 | ₹4,597 | ₹3,065 | ₹90,408 |
| Month 7 | ₹4,520 | ₹3,014 | ₹88,901 |
| Month 8 | ₹4,445 | ₹2,963 | ₹87,419 |
| Month 9 | ₹4,371 | ₹2,914 | ₹85,962 |
| Month 10 | ₹4,298 | ₹2,865 | ₹84,529 |
| Month 11 | ₹4,226 | ₹2,818 | ₹83,121 |
| Month 12 | ₹4,156 | ₹2,771 | ₹81,735 |
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Credit Card Minimum Due Formula
Calculates the minimum amount you must pay monthly to keep the card account active without late payment penalties, showing the long-term cost of this choice.
Worked Example: Credit card balance of ₹1 Lakh at 40% interest p.a.
The Credit Card Minimum Due Trap: How 5% leads to 30 years of debt
Rohan went on a vacation and accumulated ₹1 Lakh outstanding on his credit card. The bill showed a Minimum Amount Due (MAD) of just ₹5,000 (5%). Rohan paid only the minimum due, assuming he was managing his debt responsibly. He was unaware of the compound interest trap.
Because credit cards carry high interest rates (usually 40% p.a.) compounded monthly, paying only the minimum due means the remaining 95% balance compounds rapidly. It would take Rohan 356 months (nearly 30 years) to clear the debt, costing him ₹2.76 Lakhs in interest alone.
Minimum due calculations are designed to keep your account in good standing while maximizing interest earnings for the card issuer. It does not reduce your debt effectively.
Always pay the 'Total Amount Due' rather than the Minimum due. If you have a large balance, convert it into low-interest monthly EMIs or transfer the balance to clear it quickly.
Frequently Asked Questions
What is the Minimum Amount Due (MAD) on a credit card?
The minimum due is typically 5% of the total outstanding card balance. It is the minimum payment required to avoid late fees, but interest continues to accrue on the unpaid balance.
Why is paying only the minimum payment bad?
Paying only the minimum amount due traps you in a cycle of debt because card interest rates are extremely high (36-45% p.a.). The unpaid principal accumulates interest, taking decades to clear.
Does paying the minimum due affect my CIBIL score?
It keeps your account status active and avoids late payment remarks, but high outstanding balances keep your credit utilization ratio high, which negatively impacts your CIBIL score.
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