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Interest-Free Periods and the Minimum Amount Due on Indian Credit Cards

By PointsExplainedLast reviewed

Find the three numbers on your statement

Locate the total amount due, the minimum amount due and the payment due date.

Pay the total amount due if you can

Paying the entire outstanding by the due date keeps you within the interest-free period.

If you can't, pay well above the minimum

Paying only the minimum keeps the account from being treated as overdue but interest still runs on the rest, and new purchases can lose their interest-free period.

Check how interest was worked out

RBI requires statements to show how the outstanding amount used for interest was arrived at. Query anything that doesn't match your payments and refunds.

Where this comes from

Sources

The documents this guide relies on. If one has changed since we read it, the document is right and this guide is out of date.

  1. Reserve Bank of India (Commercial Banks – Credit Cards and Debit Cards: Issuance and Conduct) Directions, 2025 (RBI/DOR/2025-26/155, 28 November 2025)

    Para 5(16): interest-free credit period definition; para 5(17): minimum amount due definition; para 24: bills without delay and at least one fortnight to pay before interest; para 23(1): APRs for different situations, method of calculation with examples, how the outstanding for interest was arrived at shown in statements; para 23(2): no negative amortisation, no capitalisation of unpaid taxes/levies/charges, illustration (Rs 10,000, 2% a month, Rs 200 interest, Rs 50 indicative charges, MAD not less than Rs 250); para 23(3): minimum-payment warning on statements and MITC to explain suspension of the interest-free period; para 23(4): illustrative examples in welcome kit and website; para 23(6): interest on outstanding adjusted for payments/refunds/reversals, from the date of transaction when interest-free period is lost; para 22: interest rates guided by RBI's Interest Rates on Advances Directions, rates for categories of customers publicised on the website; para 30: credits before due date adjusted against payment due.

    rbi.org.in · Accessed
  2. SBI Card: Most Important Terms and Conditions

    SBI Card MITC: late payment charges apply if the minimum amount due is not paid by the due date; payment allocation order (GST, EMI, fees/charges, finance charges, balance transfer, retail, cash); minimum amount due composition (100% of GST, EMI, fees/charges, finance charges plus a percentage of the remaining balance).

    sbicard.com · Accessed
Questions

About this guide

If I pay the minimum amount due, will I be charged interest?

Yes, on the unpaid balance. Paying the minimum stops the bill being treated as overdue, but the interest-free period applies only if the entire outstanding is paid by the due date.

Is interest charged on the full bill or only what I didn't pay?

RBI's directions say interest is levied on the outstanding amount, adjusted for payments, refunds and reversed transactions as they are credited, and not on the total amount due.

How long do I get to pay after my statement arrives?

RBI requires issuers to give cardholders at least a fortnight to pay before interest starts being charged.
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