UK finance jargon - in plain English
The smallest amount your credit card requires each month.
The minimum payment is the lowest amount a credit card provider will accept each month without charging a late fee. It's usually a percentage of your balance or a fixed minimum set by the provider. Paying only the minimum is technically fine by the lender but very expensive for you.
You have a £3,000 balance at 22% APR. Paying just the minimum each month could take over 10 years to clear and cost more than £2,000 in interest. That's a lot of money for the privilege of spreading payments out.
Numbers simplified for illustration. Actual rates and tax rules may change.
Many people believe paying the minimum means they're managing their card well. In reality it's the most expensive way to carry debt. Always pay more than the minimum when you can.
Your minimum payment is calculated on the balance after that month's interest is added, matching how most card statements work. This assumes no new spending on the card, no fees, and an interest rate that stays constant. Minimum repayment terms vary by provider, so treat this as a guide rather than an exact figure.
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