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Many cardholders may be aware of the interest-free repayment period, but not everyone can accurately tell the calculation method of the interest-free repayment period, and as a card issuing bank gives users a treatment, the interest-free repayment period is also Not applicable in all situations.
For non-cash transactions with credit cards, the interest-free repayment period is the period from the bank bookkeeping date to the due date of repayment.
What are the billing date, the due date and the billing date we often hear?
The billing date refers to the date on which the card issuing bank credits the cardholder's transaction funds to its credit card account, or credits fees, interest, etc., to its credit card account according to regulations. The billing date is generally not the day of the card transaction, but the day after the merchant completes the payment.
The billing date is the date when the card issuing bank regularly summarizes the cardholder’s transaction payments, expenses, etc., accrues interest, and calculates the cardholder’s current payment.
The due date of repayment refers to the last date agreed by the issuing bank and the cardholder that the credit cardholder will return the current payment or the minimum repayment amount.
Let's talk about the situations where interest-free repayment period treatment is not applicable, there are three main types:
The first is that there is no interest-free repayment period for cash withdrawal and transfer overdraft. Not only that, the overdraft withdrawal will also generate relatively high interest and handling fees, of which the interest is calculated from the bookkeeping date, and compound interest will be calculated and collected on a monthly basis.
The second is that there is no interest-free repayment period if the bill is not repaid in full. If the cardholder fails to repay the payment in full, the card issuing bank will generally accrue and collect interest in full at the prescribed interest rate (usually five ten-thousandths of a daily interest rate) starting from the transaction accounting date, and compound interest will be calculated and collected on a monthly basis.
If the user uses the minimum repayment amount to repay, generally it is not 100% interest-free. For example, the ICBC Peony Credit Card stipulates that if the payment is repaid in accordance with the minimum repayment amount, the card issuing bank will still charge the overdraft interest from the bank's bookkeeping date to the repayment date on the unpaid part. If the cardholder fails to repay the minimum repayment amount before the due date, not only will it no longer enjoy the interest-free repayment period, but it will also pay a certain percentage of liquidated damages.
The third is that there is no interest-free repayment period for failure to repay on time. The failure of the cardholder to repay the payment on time is a breach of contract. The issuing bank will generally calculate and collect the interest in full at the specified interest rate from the transaction accounting date, and calculate and collect compound interest on a monthly basis.
Having said so much, is there an interest-free repayment period? Does it have a great impact on cardholders? Here is an example:
Assume that the billing date of a credit card holder of the Agricultural Bank of China is the 10th of each month, and the 25th day after the billing date is the due date. If the cardholder spends 1,000 yuan overdraft on March 11, the current bill date is April 10, and the interest-free repayment period is the due date of the April bill, that is, May 5.
1. If the cardholder repays before May 5th, he will enjoy the interest-free repayment period and only need to repay the principal of 1,000 yuan.
2. If the cardholder repays after May 5th (such as May 9th), he will not enjoy the interest-free repayment period and must repay the principal and interest.
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