What is a minimum payment on a credit card?

A minimum payment on a credit card is the smallest amount of money that can be paid to a credit card issuer in order to maintain an account in good standing. In Montana, the minimum payment is determined by the terms and conditions of the credit card agreement and typically calculated as a percentage of the statement balance due. This percentage is the minimum payment rate, and it will be noted on the credit card statement. Usually, the minimum payment rate is around 2.5% - 5% of the statement balance. For example, if the balance due on a statement is $100, the minimum payment would be $5 or the higher of $10, whichever amount is greater. It is important to note that the minimum payment is not a fixed amount, and will vary with each billing cycle. A credit cardholder is responsible for paying the minimum payment on or before the due date specified in the credit card agreement. Failing to make the minimum payment by the due date can result in late fees, increased interest rates, and penalties. Moreover, missing a minimum payment can also have a negative impact on a person’s credit score. Therefore, it is important to always make at least the minimum payment on a credit card.

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What is a minimum payment on a credit card?

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