1. What is Minimum Payment Interest?

The interest calculated when you only pay the minimum amount due on your HDFC credit card. This interest is charged on the remaining principal balance and can accumulate significantly over time.

2. How Does the Calculator Work?

The calculator uses the simple interest formula:

Where:

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

Explanation: The equation calculates the interest you'll pay each month when making only minimum payments.

3. Importance of Interest Calculation

Details: Understanding this calculation helps credit card users realize how much they're actually paying when carrying a balance and making only minimum payments.

4. Using the Calculator

Tips: Enter your current credit card balance in INR and your card's annual percentage rate (APR). The calculator will show your monthly interest charge.

5. Frequently Asked Questions (FAQ)

Q1: Why is my interest higher than this calculation?
A: This is a simplified calculation. Actual interest may include fees, compounding, or daily interest calculations.

Q2: How can I reduce my interest payments?
A: Pay more than the minimum, pay early in the billing cycle, or consider balance transfer options.

Q3: Is this calculation specific to HDFC cards?
A: While the formula is universal, HDFC's exact calculation method may vary slightly based on their specific terms.

Q4: Does this include the minimum payment amount?
A: No, this calculates only the interest portion. Minimum payment typically includes interest plus 1-5% of principal.

Q5: How often is interest compounded?
A: Most credit cards compound interest daily, though this calculator shows monthly interest for simplicity.