1. What is Credit Card APR?

APR (Annual Percentage Rate) represents the yearly interest rate charged on credit card balances. This calculator helps you determine how much interest you'll pay each month on your outstanding balance.

2. How Does the Calculator Work?

The calculator uses the formula:

Where:

• \( P \) — Principal balance (Rs)
• \( R \) — Monthly interest rate (annual APR / 12, as decimal)
• \( I \) — Monthly interest (Rs)

Explanation: The formula calculates the monthly interest by multiplying the principal balance by the monthly interest rate (APR divided by 12 months).

3. Importance of APR Calculation

Details: Understanding your monthly interest helps in budgeting and making informed decisions about paying down credit card debt.

4. Using the Calculator

Tips: Enter your current credit card balance in Rs and the annual APR percentage. The calculator will show your estimated monthly interest charge.

5. Frequently Asked Questions (FAQ)

Q1: How is APR different from interest rate?
A: APR includes both the interest rate and any additional fees, giving a more complete picture of borrowing costs.

Q2: What is a good APR for credit cards?
A: Average APRs range from 15-25%. Lower is better, with rates under 15% considered good.

Q3: Does paying minimum affect interest?
A: Yes, carrying a balance means interest accrues daily on the remaining principal.

Q4: How can I reduce credit card interest?
A: Pay balances in full each month, negotiate lower rates, or transfer to lower-APR cards.

Q5: Is interest charged if I pay full balance?
A: No, if you pay the statement balance by the due date, no interest is charged.