What is the minimum payment required on my credit card each month?

The minimum payment required on your credit card each month is typically calculated by your credit card issuer and can vary based on several factors. However, it's usually determined as a percentage of your outstanding balance, often ranging from 1% to 3% of the total balance, or a fixed minimum amount, such as ₹200 or ₹500, whichever is higher.

Here are some key points to keep in mind regarding minimum credit card payments:

1. Varies by Issuer: The specific calculation and minimum payment percentage can vary among credit card issuers, so it's essential to check your card's terms and conditions or contact your issuer for the exact details.

2. Interest and Fees: The minimum payment typically covers the interest charges for the month and a portion of the principal balance. It may also include any late fees or other charges. Paying only the minimum will result in the slowest repayment of your credit card balance.

3. Credit Utilization: Paying only the minimum can lead to high credit utilization, which may negatively impact your credit score. Credit utilization is the ratio of your credit card balances to your credit limits, and lower utilization is generally better for your credit.

4. Interest Accumulation: If you only make the minimum payment, a significant portion of your payment goes toward interest, and the principal balance may take a long time to pay off. This can result in paying much more in interest over time.

5. Pay More Than the Minimum: To save on interest and pay down your credit card debt faster, it's advisable to pay more than the minimum whenever possible. Paying the full statement balance by the due date is the best way to avoid interest charges entirely.

6. Automatic Payments: Consider setting up automatic payments for at least the minimum amount to ensure you don't miss payments and incur late fees.

7. Avoid the Minimum Payment Trap: While paying the minimum is a way to stay current on your card, it's not a sustainable longterm strategy for managing credit card debt. Try to pay as much as you can afford above the minimum to reduce your debt efficiently.

Remember that the minimum payment is a requirement to keep your credit card account in good standing, but it's generally not a financially savvy way to manage your credit card debt. To maintain healthy finances and a good credit score, it's best to pay your credit card balance in full by the due date or pay as much as you can above the minimum to reduce your debt more quickly.