Understand Credit Card Interest Calculation

Many credit card users assume they will be charged interest only on ₹500 for 19 days—the period before the next statement is generated. However, the larger interest component actually stems from the ₹1,000 that remained unpaid for the first 41 days. This means there is no interest-free period, a crucial detail that many customers overlook. Banks classify such users as "Revolvers", applying interest on transactions from the moment they are made.
To avoid high credit card interest rates and maximize your interest-free period, always aim to pay your total outstanding balance on time. Understanding how banks calculate interest can help you manage your finances smarter and save more.