Credit Card Statement: What your statement date, minimum payment really mean | Mint

Credit cards have become quite popular amongst people and have turned from a luxury to more of a necessity in today’s time. With credit cards, you do not have to spend cash immediately on purchases as your credit card will make the payment on your behalf and you do not have to worry about the bill until next month’s cycle. Let us understand what a credit card statement is and how it is calculated.

What is a credit card statement?

A credit card statement is a statement that is provided to you every month showing a detailed account of all the payment, purchase, credit and debit made in the billing cycle period. It also shows the amount that was paid in the earlier month, how much is required to be repaid, and the date by which it must be done also extra charges if any. Lenders usually issue statements at least fifteen days before the payment date due.

It is important to understand your credit card statement so as to monitor your spending, what your credit card has been charged for, and in order to look for anything that is fraudulent or in error. Hence, by studying your credit card bill statement, you can have a clear understanding of the terms and details of your credit card, you may also be able to control your credit card payments and even avoid those outrageous fees.

Key elements of a credit card statement

Your credit card statement majorly includes billing cycle, total due amount, summary of the merchants’ transaction, and whether a finance charge has been applied. It also explains the non-sufficient funds fees, penalties, refunds, EMIs, and credit limit on the card. Any payments made after the due date of the bill will not show in your statement but are recorded online when you log into the account.

Here are some of the key elements of your credit card statement which you must read before paying your bill:

Statement date: Complete date till which the statement is prepared including all transactions of the preceding billing cycle.

Payment due date: The date beyond which you will be charged a penalty which may affect your credit score.

Last month’s balance: A report on the outstanding amount which was due for the previous month.

Statement balance: All accounts received, whether being new transactions or arrears.

Minimum payment: You will also be given a chance to repay the bill with a minimum amount mentioned in your statement. In case of a financial constraint, you may pay this amount and pay the remaining balance in the next cycle.

What to do in case of discrepancy in the statement?

You should pay attention to your monthly statements as this is the best time to identify an unauthorised transaction, and to act on it. If in case you find any error in your statement, here’s how you can rectify it:

Contact the merchant: First, report it to the merchant, so that they also know that something went wrong. Most of the time, merchants can reverse the error without the need to contact the bank. If you still have not got your issue resolved, contact your bank immediately.

Gather supporting documents: Make sure you have a copy of all documents including your credit card statement, receipts, or any other documents that may provide proof for your case.

Notify the bank in writing: Writing or sending an appeal to the bank’s billing inquiry department should be done not later than two months after the statement was prepared. Make sure that you enclose copies of your evidence and describe the transaction in detail that you are defending.

Conclusion

Credit card companies give monthly statements of your transactions, current balance, credit limit, and due date of payment of your credit card. Although it is interesting to note that most cardholders tend not to read their credit card statements and blindly repay their bills.

In case of a dispute then it has been seen that if befitting action is taken and documentation is proper then the issue is settled smoothly. You also must understand that credit cards may make you form a habit of them and if you do not use them wisely, you may end up in a debt trap.

(Note: Using a credit card carries its own set of risks)