Why credit card debt is so expensive
Credit cards carry some of the highest interest rates of any borrowing — often 30% to 48% a year in India, which is around 2.5% to 4% every month. Once you carry a balance, the interest-free period disappears and even new purchases start accruing interest immediately.
The minimum payment trap
The "minimum amount due" on your statement is typically about 5% of the balance. Paying only that keeps your account in good standing but barely touches the principal — a balance can take years to clear and cost more in interest than the original spend. Paying a fixed amount well above the minimum dramatically shortens the payoff and cuts interest.
Faster ways out
- Stop using the card until the balance is cleared.
- If the APR is very high, ask to convert the balance to an EMI, or take a lower-rate personal loan to pay it off.
- If you hold several cards, clear the highest-rate one first.