CREDIT CARD PAYMENTS: How to maximise benefits of interest-free period

financialexpress.com:

In this digital age, credit cards have become an indispensable financial tool as they offer convenience, security, and various rewards and benefits. However, most people tend to ignore some of the key features of credit cards. One essential feature that often goes unnoticed is the interest-free period — a grace period during which cardholders can make purchases without incurring any interest.

Understanding and effectively utilising the interest-free period is crucial for consumers to enjoy the benefits of credit cards without falling into a debt trap. It is important to know how to use the grace period more effectively.

The interest-free period, also known as the grace period, is the period from the date of a credit card transaction to the due date of the bill for that particular transaction. During this period, cardholders have the opportunity to repay the entire outstanding balance without incurring any interest charges. The interest-free period typically ranges from 20 to 50 days, and may vary depending on the credit card issuer’s policy and the specific billing cycle.

Interest savings: The key reason to leverage the grace period is to save on interest costs. By paying the entire outstanding balance within the grace period, cardholders avoid paying any interest on their purchases, making credit card usage cost-effective.

Adhil Shetty, CEO, Bankbazaar.com, says, “By paying off your credit card balance within the interest-free period, you not only save on interest charges but also enhance your creditworthiness. Plan major expenses strategically, align them with your billing cycle, and enjoy more days of interest-free spending. Avoid minimum payments and clear your outstanding balance in full before the due date to reap