To pay only the necessary minimum on your credit card balance could be expensive to you in terms of interests. It is to help the consumers better understand the advantages of refunding as soon as possible the balance of their credit card that the Financial Consumer Agency of Canada (FCAC), has launched its new interactive tool, the Credit Card Payment Calculator.
“Many consumers know little about the consequences to limit themselves to the minimum payment fixed by the issuer of their credit card. Several of them do not realize that while proceeding in this way, they find themselves in the end paying an important amount of money in terms of interests,” indicated Ursula Menke, the commissioner of the FCAC.
The Credit Card Payment Calculator compares three options of payment: the minimum required balance, the minimum required balance plus an additional amount and finally, a fixed monthly amount higher than the amount of the minimum payment. Once the data have been entered into the calculator, the tool determines the amount of interests, the total amount paid out and, if necessary, the savings made according to the option of refunding chosen by the consumer. Depending on his financial standing, the consumer can change the data entered in order to see how he could optimize his economies in interests.
“By seeing the results obtained using the Credit Card Payment Calculator, the consumer is more able to understand the monetary consequences of an unpaid balance and to choose, thereafter, the mode of payment which will be more advantageous to him,” added commissioner Menke.
The consumers will be able to access the Credit Card Payment Calculator and to address their comments by visiting the Web site of the FCAC, www.monargentmesoutils.ca . This calculator is added to the interactive tool : Credit Cards and You, which allows the consumers to choose the credit card which meets their needs. By consulting the publications : Managing Your Money: How to Save with a Credit Card and Getting the Most from Your Credit Card, also available on the Web site of the Agency, the consumers will be able to learn how to save interests by making payments early between the statements or, to know the benefits and risks associated with credit cards. The consumers who wish to do so can also communicate with the FCAC without expenses, at 1-866-461-2232 (or at 1-866-914-6097 for the ATS service, for deaf or semi-deaf people).