Credit Card Repayment Calculator

Credit card interest compounds monthly on the outstanding balance after each statement period. A typical UK APR of 24.9% translates to a monthly periodic rate of approximately 1.870%, calculated as (1 + 0.249)^(1/12) - 1. Each month, interest is charged on whatever balance remains after your payment is applied, creating a compounding effect that significantly increases total costs when only minimum payments are made. Viewed daily instead, the same APR works out at about 0.061% a day, so £3,000 at 24.9% APR accrues roughly £1.83 a day, about £56 a month.

Minimum payments in the UK are usually calculated as the greater of a fixed floor amount, typically £5 or £25, or a percentage of the outstanding balance, usually 1% to 3% plus that month's interest. Because the percentage-based minimum shrinks as your balance decreases, repayment slows dramatically over time. A £3,000 balance at 24.9% APR with a minimum of 2% of the balance (at least £25) would take more than 55 years to clear and cost around £22,000 in interest, because 2% barely beats the 1.87% monthly interest. At 19% APR the same balance on a minimum of interest plus 1%, about £74 in the first month, still runs 14 years 2 months and £3,433 of interest, because roughly £44 of that first £74 is interest and only £30 touches the principal.

Progress is slow enough to be hard to see. After 12 months that balance is still £2,659, and after 5 years it is still £1,641. The FCA persistent debt rules, in force since 2018, oblige card issuers to contact customers who have paid only the minimum for 18+ months, offering affordability help, a payment plan and, in extreme cases, an interest freeze. Paying above the minimum changes the arithmetic fast, since even £20 extra a month makes real inroads, and a fixed £124, £50 above that first £74 minimum, clears the £3,000 in 2 years 7 months and saves about £2,700 of interest.

The calculator compares a fixed monthly payment of your choice with paying only the minimum, modelled as interest plus 1% of the balance, at least £25. Fixed payments above the minimum accelerate principal reduction because the interest portion shrinks each month while the total payment stays constant. On a £4,500 balance at 24.9%, a monthly rate of 1.870%, the minimum comes to £129.16 in month one, of which £84.16 is interest and only £45.00 is principal. Left on the minimum, the card takes 18 years 5 months and £7,338 of interest. At a fixed £150 a month it clears in 3 years 9 months for £2,166, a saving of £5,172.

Moving a balance to a 0% transfer offer is the standard escape route, with the longest deals now running 36 to 38 months at 0% (MoneySavingExpert best buys, September 2026) and transfer fees of typically 3% to 3.5%. Shifting £3,000 with a 3% fee costs £90 up front, and on a 24-month deal £128.75 a month clears the £3,090 inside the promotional window. The same £128.75 a month on a 24.9% card takes 2 years 7 months and £977 of interest, so the transfer saves about £887. Two conditions apply. You need a good enough credit score to qualify, and you must actually clear the balance before the offer ends, or the rate reverts to a standard 20-30% APR. New purchases on the same card may carry a different rate, and a missed payment can end the 0% deal, so pay by direct debit.

With several cards, two orderings compete. The avalanche method is mathematically optimal, paying the minimum on everything and then putting all spare cash against the highest APR. The snowball method pays minimums and attacks the smallest balance first, so quick wins build momentum. Avalanche generally saves £100-£500 on a typical debt load, and the sensible compromise is to use it unless motivation has been the sticking point before, in which case snowball earns its keep. Standing orders and direct debits help either way, because automation removes the monthly decision.

Paying in full each month costs nothing in interest and builds your credit file, and setting a direct debit for the minimum with a manual top-up to the full amount gives you a safety net. Section 75 of the Consumer Credit Act 1974 makes the card issuer jointly liable with the retailer for items with a cash price over £100 and up to £30,000, even if only part of the price goes on the card, which is why a deposit paid by card is worth more than the convenience. Most UK cards charge about 2.99% on non-sterling spending, although a few travel cards charge no foreign-usage fee. Cash advances carry a fee, often around 3%, and interest from day 1 with no grace period. Keeping utilisation under 30% of your limit helps your score.