What happens if you only pay the minimum amount due?
Minimum amount due is the 5% of the total outstanding bill & it should be paid anyhow.
You can only avoid the late fee charges by paying only the minimum amount due, but you have to pay interest on remaining amount on next bill.
Paying only minimum amount due has more disadvantages than benefits.
1. Your credit limit will be reduced if you pay only the minimum amount due rather than the outstanding bill.
2. A high interest rate will be charged on the remaining outstanding balance, and the minimum amount due will be increased in next bill.
3. If you pay only the minimum amount due, then your credit score will be badly affected.
4. If due to some reason you are in financial tight, then you should pay atleast the minimum amount due.
You should be aware of every details of credit card, if you are using it.
For more reliable information on credit card follow our blog bellow.