Understanding the Credit Card Monthly Statement
From Financial Literacy Wiki
Understanding Credit Card Monthly Statement
The credit card issuer will send you a monthly statement detailing all your purchases you have made with the card during the month. It is important to check your monthly statement carefully and inform the card issuer promptly if there are any discrepancies or if any clarification is required. Do also take note of the following in your monthly statement.
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Statement Date
This is the date the statement is issued. All transactions recorded between this statement date and the last statement date will appear on this statement.
Payment Due Date
This is the date by which you should pay your credit card bill without incurring late payment charge. You have the option to pay the bill in full or make a partial payment subject to a minimum sum.
Amount Due
The amount due denotes the outstanding balance you charged to your credit card. As a practice, card issuers do not charge interest if the outstanding amount shown on the monthly statement is paid full by Payment Due Date.
If you do not pay the outstanding amount in full by payment due date, you will incur interest charges.
Thus it is strongly recommended to settle your credit card bills in full and promptly if you want to enjoy the use of interest-free credit.
Minimum Sum
A credit card holder can pay a minimum sum, which is usually 3-5 percent of the outstanding balance or $50, whichever is higher.
If you cannot pay the bill in full, you should at least pay the minimum sum by the payment due date and rollover the balance. But do note that when this happens, you lose your entitlement to interest-free credit for your current and subsequent purchase. Interest will be calculated on the outstanding balance either from the date each transactions was effected, or the statement date, depending on the card issuer's policies. New purchase in such circumstances will attract interest immediately.
Late Payment Charge
If full or partial payment is not made by payment due date, a late payment charge would be levied by the card issuer.
Interest Charges
Interest on outstanding balance is calculated baed on your daily outstanding balances at the rate of 0.066%per day (assuming an interest rate of 24% per year.) calculated from the date each transaction was effected or the statement date (depending on the card issuer's policies).
For cash advances, interest will be charged from the date the withdrawal takes place.
Transactions in Foreign Currency
Transactions overseas charged in foreign currency will be converted to Singapore dollars in your monthly statement. The foreign exchange rates used to convert these transactions into local currency fluctuates day-to-day and bank-to-bank.
The card issuer should explain the method of applying the exchange rate to foreign currency transactions and any other fees or charges. This usually can be found in an explanatory note printed at the back of the montly statement.
