Understanding Your Credit Card Statement
A credit card statement shows a summary of the transactions made using the credit card during a specified billing period. When you receive your statement, it is important to read all the fine prints, terms, key numbers and dates, as well as ensure that there are no unauthorised charges or billing errors in your statement.
To help you understand your credit card statement better, we have listed below the key features that you need to pay attention to when reading your credit card statement:
Statement Date
As a credit cardholder, you should know when your statement date is and the period of your credit card's interest-free days. Interest-free days refer to the period of time in your credit card billing cycle where no interest is charged on any of your purchases.
Payment Due Date
The payment due date is the last day that you are given to pay your outstanding balance before the bank starts charging you penalties for being undisciplined in your payment. Keep track of your due dates and ensure monthly obligations are repaid on time to avoid unnecessary additional charges. Any outstanding balances, including interest, that are not cleared by the due date will incur additional interest in the next payment statement.
Note: For credit cards issued by Islamic banks, an “administrative fee” will be imposed to the credit card holders that fail to make full payment on the due date.
Minimum Payment Due
As the name suggests, it is the minimum amount that you are required to pay on or before the payment due date in order for you to maintain your card account. Typically, the minimum amount payable may be different every month depending on your credit card purchases. Your bank may charge a specific minimum amount, or approximately 8% of the total outstanding balance or whichever of the two amounts is higher. However, it is best for you to pay more than the minimum amount to avoid more interest and to shorten the repayment period. Some credit card issuers may suspend the credit card account in the event that you make no repayment.
New Balance
The new balance shows the total amount that you are responsible to pay. If you have not paid the minimum due amount for a month or more than that, this will be reflected in the 'Overdue' section of your credit card statement. Note that the longer the duration of your overdue, the higher the late fee you will be charged. However, if you pay more than the amount that you owe, the figure will be noted as "CR" meaning the extra amount that you paid will be adjusted on next month's credit card balance.
Credit Limit
Your credit card's credit limit is the maximum outstanding balance you can have on your credit card at a given point in time. If you purchase items more than your credit limit, your purchases will be rejected. For example, if your credit limit is B$1,000, you will only be able to make purchases up to that set amount. Any purchases that go beyond your credit limit will be rejected. Subject to your respective bank's credit risk management, you can request for a credit extension.