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Credit cards are used widely all over the world. Millions of people use them regularly for making special purchases and even day to day purchases, and why wouldn't they? It is convenient to carry, fits into your wallet just like any other small card, carrying the value of endless privileges. There are many advantages of credit cards, but at the end of the day, like all other borrowings, you have to pay the money back to the bank within a time frame that is decided by your bank.

The concept of minimum payment comes into effect, when and if you find yourself unable to pay off the entire amount that you have utilized during a given period. This is calculated as a small percentage of the total credit balance. This can also be defined as the minimum amount a customer can pay on their credit outstanding in order to avoid late payment fee(s) and maintain a good repayment history.

The amount of minimum payment depends upon the total amount that you have spent and an interest fee charged by your bank. Let's take a deeper look into the calculation of the minimum payment.

The percentage of minimum payments on your total outstanding balance are set by the issuer of your credit card (banks or a financial institution). It is generally set quite low, because the slower you pay, the longer you owe the bank and the greater the interest they earn.

In the UK, there is a set standard rate of minimum 1% of the outstanding balance plus the interest rate that a bank charges or an amount ranging from £5 to £25 per month, whichever is higher. Additionally, there can be other charges like an annual fee or such. Not all countries leverage this minimum payment amount but it provides a good example of how a government has had to intervene to ensure good financial conduct in lending markets.

So you see, you are not necessarily paying off the debt, you are being charged a huge amount of interest tat can see you repaying credit cards for decades. Whilst this is a concern, a good thing with credit card borrowing is that unlike loans, you choose what you pay. This is ideal if you need to take a short term burst of cash, particulalry if you secure an interest free credit card for the borrowing. Calculating the minimum payment charge can be done manually, but there is an easier way to go about it. Using an online calculator that is ideal in these situations, let's take a look at how you can take advantage of iCalculator's, credit card minimum payment calculator.

Using the calculator is easy, it is designed in a way that enables you to make use of it at your convenience, it is online and can be used on your PC, laptop, mobile phones or tabs. All you need is to get the below mentioned information that you can easily obtain from your bank and enter it into the calculator to find out your credit card minimum payment. You bank or credit card provider may well have their own calculator to help you reduce the debt and see how changing payments can reduce the amount of money you owe on your credit card. If they don't, the below tool is a good calculator for credit card repayments.

**Credit card account balance:**This is the total amount that is outstanding on your credit card.**Annual percentage rate:**Enter the percentage value that your bank charges on the credit card balance annually.**Minimum payment percentage:**This refers to the percentage that your bank allows you to pay on your total outstanding balance.**Your minimum payment account factor:**As explained above, this is the amount that your bank charges (if applicable) if you are not paying the entire balance off.

On the basis of your inputs, the calculator will provide you with your credit card minimum balance amount, that you can compare with your physical or online credit card statement. You can contact your bank in case of any disconnect.

You may find it easier to pay the minimum payment because it is only a fraction of what you have been able to spend, but do you think it is really worth making minimum payments? Let's try to find out.

There are many advantages of making minimum payments, including the fact that if you keep making minimum payments, your bank will never report you to the financial authorities for irregular repayment. You can maintain a good repayment track record with your bank and your overall credit score will not be affected. But, making minimum payments will not help you to repay the money you owe the bank for a very long time so only making minimum payments is not a good financial strategy.

Statistics say that if you borrow £3,000 today and make only minimum payments, it may take as long as (almost) 30 years to pay it off. If you calculate the percentage, you might end up paying 250% to 300% of the value that you have actually used. Since you can choose what you pay, it is advisable to pay as much as you can afford every month to get out of this circle.

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