Can I change my credit card billing cycle?

You may change your credit card billing cycle by talking to your respective credit card customer. However, as per RBI's 2022 regulations, now the billing cycle can only be modified once. So, you must take your cash flow into consideration before getting the billing cycle updated as it cannot be modified again.

Should I pay my credit card bill on or before the due date?

You can pay the bill on or before the due date at your convenience. However, paying the bill later will incur additional charges.

What happens if I pay only the minimum amount due?

If you pay only the minimum amount due, your card issuer will start levying interest on the remaining amount. Moreover, all your new transactions will start accruing interest from the first day, as the interest-free period becomes ineligible when you have unpaid balance in your card account.

Credit Card Billing Cycle

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Credit Card Due Date

Your credit card due date is the last date until which you are supposed to clear your bill and it is usually after 15 to 25 days from the statement date. For instance, let us consider that your credit card statement is generated on the 6th of every month and your due date is the 26th of the same month. What this simply means is that you have to pay your dues till the 26th and no extra charges will be levied on paying within this time frame.

Now, if you are unable to pay the total due amount* or even the minimum due** within this time frame. You will be charged a late fee as well as interest on the due amount.

*Total Amount Due -Total amount due is the entire amount due for payment as on the statement date.

**Minimum Amount Due -Minimum amount due is a percentage of the total outstanding amount that you must pay to the bank if you are unable to pay the complete bill amount. Paying the minimum amount due by the due date prevents you from paying the late payment charges and being considered a defaulter by the issuer. However, interest is accrued on the remaining amount.

Credit Card Interest Free Period

Credit card interest-free period is the duration for which the amount used on a credit card does not attract any interest. It can also be understood as the duration between the first day of the billing cycle and the day on which the payment is due. Let us understand interest-free period with an example:

Statement Generation Date - April 6th
Due Date - April 26th (After 20 days)

So, here the statement generated on April 6th has all the transactions that occurred between March 6th to April 5th. Let us take into consideration, 5 transactions that took place before the bill was generated on April 6th.

March 16th - Rs, 1,500
March 7th - Rs. 2,500
March 31st - Rs. 10,000
April 2nd - Rs. 1,000
April 4th - Rs. 1,200

Since the bill was generated on the 6th of April, the above transactions did not incur any additional charges until then. Taking into account the transaction that took place on March 7th, no additional charges were incurred for 50 days (24 days of March + 26 days of April). This entire period of 50 days is the interest-free period for this particular transaction. In the same manner, the interest-free period for all other transactions can be calculated:

Transaction Date	Transaction Amount	Interest-Free Period
March 7th	Rs. 2,500	50 days
March 16th	Rs, 1,500	41 days
March 31st	Rs. 10,000	26 days
April 2nd	Rs. 1,000	24 days
April 4th	Rs. 1,200	22 days

Suggested Read: Credit Card Interest Rates

Strategies to Manage Your Billing Cycle Effectively

The Reserve Bank of India has mandated banks to provide cardholders with the option to change their billing cycle at least once, allowing them to adjust the statement date and due date as per their convenience. Here is how you should strategize it smartly.

Review your cash flow: Most people receive their salary or any form of primary income on a particular date. Aligning your billing cycle in a way that the due date falls shortly after this date can make repayments easier.

Set the right strategy for different cards: When you have multiple credit cards, you can adjust some of billing cycles in a way that you can spread out your payment obligations. Alternatively, you can align all billing cycles, so that all bills are cleared at once, reducing the risk of delayed/missed payments.

Plan bigger purchases at the start of a cycle: Purchases made right after statement generation get to enjoy the full interest-free period (typically 40-50 days), depending on the card. Planning larger purchases at the start of a billing cycle will give you enough time to pay it off without incurring interest charges.

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How to Apply for a Credit Card Online?

Step 1: Enter your mobile number in the application form

Step 2: Provide your personal details

Step 3: Enter OTP to verify your mobile number

Step 4: Select the credit card purpose and credit card amount

Step 5: Compare offers and apply for the best-suited credit card

Apply Now

FAQs

Do All Credit Cards Have the Same Billing Cycle?

No, all credit cards do not have the same billing cycle. Each card has its own billing cycle, which is shared with you when the card is issued. You can find this information in the welcome kit or card documents, and many banks also communicate it via SMS or email.

What happens if I make a purchase right after the billing cycle ends?

If you make a purchase right after your billing cycle ends, it will be included in your next billing cycle. For example, if your billing cycle is from 20th March to 20th April, statement will be generated on 20th April. Now, a payment made on or after 21st of April will be added to your next statement, that is, 20th April to 20th May, and will be due in the next month.

How does the billing cycle affect interest charges?

Your billing cycle is the period for which your credit card transactions are recorded, and the due date falls around 7-15 days after the statement date (varying from card to card).If you pay your total amount due on or before the due date, no interest is charged. However, if you carry a balance beyond the due date, interest starts accruing. So, understanding your billing cycle and due date helps you plan payments and avoid interest charges.

Does Changing the Billing Cycle Affect Credit Score?

Changing your billing cycle does not have a direct impact on your credit score. However, if aligning the billing cycle with your cash flow helps you manage repayments more effectively, it can lead to timely payments, which can positively influence your credit score over time.

How can I know my credit card billing cycle?

Your credit card billing cycle is shown on each month's card statement. It is also mentioned on the welcome document which you received along with your credit card.

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