What are the Consequences of Solely Paying the Minimum Due in Credit Cards?

Credit cards are an invaluable tool that significantly enhances people’s daily lives, enabling convenient and timely purchases whenever needed. However, many individuals encounter challenges when it comes to repayment. It’s not uncommon for some to inadvertently miss their due dates or be caught in a debt cycle. Consequently, they may pay only the minimum amount due on their credit cards. 

Would you like to know the advantages and disadvantages of paying only the minimum due on your credit card? This strategy has some important considerations that can impact your credit card’s CIBIL score. Let’s explore the implications together as we dive into this article. 

By the end, you’ll have a clearer understanding of the consequences associated with this approach of just clearing off the minimum due on your credit card.

What is the Minimum Due on a Credit Card?

The minimum amount due represents the smallest monthly payment requested by a user’s credit card issuer. This sum is calculated as 5% of the outstanding credit card balance. It’s essential to be aware that merely paying the minimum amount will not fully clear the debt. 

By doing so, users are only avoiding late payment charges on their outstanding balance, but they will still be responsible for paying the accrued interest on the remaining credit amount.

It’s important to note that paying the minimum due helps protect the users’ credit scores from adverse impacts. Still, aiming for larger payments is advisable to reduce the overall debt more effectively. Individuals can better control their financial health and minimise long-term interest costs by responsibly managing their credit card payments.

What Happens If You Only Pay The Minimum Amount Due On Credit Card

Growth of interest: One of the potential downsides of making only the minimum payment on a credit card is the accumulation of high-interest charges on the remaining balance. Failing to pay the full balance means that the remaining amount will begin to accrue interest, which then gets added to your primary balance. Over time, this compounding interest can lead to a significant increase in your overall debt. It’s essential to be mindful of this aspect to avoid facing unnecessary financial burdens in the future.

Extended debt repayment: By paying the minimum due, you stretch out the repayment period for your credit card debt. As a result, the interest accumulates, and it takes much longer to clear your outstanding balance. You may find yourself trapped in a cycle of revolving debt where your balance keeps increasing, despite making regular payments. 

Higher total repayment amount: You are aware that the higher the repayment option, the longer it takes to pay your credit card balance, the more you end up paying in the long run. The interest charges continuously add up for the minimum due on a credit card, and you can pay significantly more than the original amount you charged to the card. At the end of the result, your finances may be impacted, and the value of your purchases may be diminished.

Credit score impact: Your payment history is crucial in determining your credit score. When you consistently pay only the minimum amount on your card or miss payments, it can negatively affect your credit score. A lower credit score can increase the difficulty of qualifying for loans, and credit cards.

Financial stress: The accumulation of debt and the constant presence of outstanding balances can lead to increased financial stress. Managing multiple balances, due dates, and interest rates can become confusing, cause anxiety, and impact your overall well-being.

Minimum payment issue: The minimum due is calculated as a percentage of your outstanding balance. It is mainly around 5% to 10%. As your balance increases due to interest, the minimum payment also increases. It can create a false sense of stability because even though you pay the minimum, your debt continues growing.

Limited credit availability: Lenders might view you as a higher credit risk if you carry high credit card debt and make only minimum payments. It sometimes makes it difficult to get the best credit card in India and additional credit benefits when needed. 

Difficulty in achieving financial goals: The burden of credit card debt can keep your ability to achieve significant financial goals such as saving for emergencies, buying a home, or planning retirement. The money to pay interest could be better allocated to these goals.


Consistently paying just the minimum due on credit cards can trigger a cycle of accumulating high-interest debt. This approach lowers credit scores, limits opportunities, and impacts mental well-being. Breaking free requires proactive steps beyond minimum payments to ensure financial stability and peace of mind. 

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