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What is the Minimum Payment on a Credit Card?

Last Updated: May 29, 2024
4 min read

Key points about: minimum credit card payments

  1. Your minimum payment is the lowest amount you must pay toward your monthly credit card statement balance in order to keep your account current.

  2. If you don't make your minimum payment on time, your card issuer may charge a late fee and penalty interest.

  3. Setting up automatic payments and text or email alerts can help you pay your minimum payment on time each month.

Your monthly credit card statement is full of important information; a number worth paying particular attention to is your minimum payment amount. The minimum payment on a credit card represents the smallest amount you must pay toward your monthly statement balance to keep your account current. Let’s look at why your minimum payment is an essential part of your debt management.

Minimum payment vs. statement balance

Your monthly credit card statements include your minimum payment amount and your statement balance, which is the total outstanding charges on your account as of the day your billing cycle ends.

Most card issuers only require you to pay your minimum payment on or before your payment due date each month to keep your account current. However, your statement balance is the amount you must pay to avoid paying interest; if you only make the minimum payment due, you’ll pay interest on the balance you carry past the due date if you’re not enrolled in a 0% interest rate.

Some credit cards offer a low introductory interest rate as part of a promotion. During that period, you can make minimum monthly payments without accruing as much interest as you typically might. However, it’s important to repay your statement balance before the intro period ends.

Your credit card statement should also include a minimum payment disclosure explaining how long it may take to pay off your statement balance when only making the minimum payments. You can use the Discover credit card interest calculator to see what interest you'll owe on any credit card balance and how increasing your monthly payments may help you pay down your credit card debt sooner. 

How is your minimum payment calculated?

When you open a credit card account, you agree to specific payment terms, including making a minimum monthly payment toward your balance. Typically, a borrower's minimum payment is not a set amount but a percentage of the statement balance, often plus interest and applicable fees. This means your minimum payment can change based on what you owe. If you typically carry a low outstanding balance, you'll usually have a low minimum payment amount; a higher outstanding balance will usually result in a higher minimum payment due.

Review your credit card's terms and conditions to understand how your credit issuer calculates your minimum payment.

What if your minimum payment is late?

Unfortunately, there are consequences for a late credit card payment. For example, late payments can negatively impact your credit score and can appear on your credit report. Even if you only pay a portion of the minimum monthly payment amount, you can hurt your credit and run the risk of incurring penalty fees.

Did you know?

A card issuer may charge late fees for payments made after they’re due. Some credit card companies may also impose a higher penalty interest rate. But Discover has no late fee on your first late payment.1

According to the Consumer Financial Protection Bureau, late fees can't exceed the minimum amount due, but late fees can increase, especially if a borrower is late on payments more than twice within a short span of time.

Need help making your minimum payments on time? Consider setting up automatic monthly payments or using text and email alerts to notify you when your payment is due. 

Your credit card minimum payment is a number you need to know. And understanding the role it plays in your borrowing can help you successfully handle your credit card account.

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  1. Card No Late Fee: Only eligible for Discover it® Cards (including all new Chrome, Miles, Secured, and Student Cards)
  • Legal Disclaimer: This site is for educational purposes and is not a substitute for professional advice. The material on this site is not intended to provide legal, investment, or financial advice and does not indicate the availability of any Discover product or service. It does not guarantee that Discover offers or endorses a product or service. For specific advice about your unique circumstances, you may wish to consult a qualified professional.