One of the most popular financial tools that allow individuals to make purchases, borrow money and earn rewards is a credit card. However, the feasibility and flexibility offered by this card sometimes put the user at risk of overspending and falling into debt.
However, it is very important to use this card wisely and doing the credit card bill payment on time.
What is a credit card?
It is a payment card that allows an individual to borrow money from a financial institution/bank in order to make purchases. So, when you, as a credit card holder, use it to pay for any goods or services, the bank pays the merchant on your behalf, and you become responsible for paying back the bank later before a particular date.
They generally come with a credit limit, which is the maximum amount of money you can borrow at any given time. It is determined by the bank based on your creditworthiness and other factors such as credit history, monthly income, and employment status.
What is a credit card statement?
It is a periodic report that summarizes your card account activity over a particular time period, typically one month. In addition, this statement offers a detailed breakdown of all the purchases, payments, fees and interest charges that have been applied to the account during that period.
Furthermore, it also includes essential information such as the balance on your account at the beginning and end of the statement period, credit limit, and the minimum payment due. Along with this information and many more factors, one thing to remember is that it is very important to review the credit card statement regularly to ensure you are on the right track.
Understanding Credit Card Statement and Payment Terms
● Balance Summary
This section offers an overview of the balance in your account. It includes previous balance, new purchases, transfer of balance, cash advances, fees etc., applied to your account during the statement period.
● Due Date
The due date for payment is when the holder must make the minimum bill payment to avoid late fees or penalties. This particular date is generally at least 21 days after the end of the statement period.
● Minimum payment
It is the minimum amount one must pay by the due date to keep the account in good standing. This amount is a small percentage (1-3%) of the account balance.
● APR
The annual Percentage Rate is the rate of interest charged on your outstanding balance of the credit card bill payment. It totally varies depending on your creditworthiness, the type of card you have, and other factors.
● Transaction details
This section provides a detailed list of all purchases, payments as well as other transactions made on the account during the statement period. The information includes the date of each transaction, the merchant or payee, and the amount charged or paid.
Conclusion
Personally speaking, one of the most important aspects while availing this card is credit card bill payment. So, have faith in yourself, pay your bills timely and enjoy the perks of this card.
