What is a minimum payment?

Minimum payment

A credit card's minimum payment is the least it requires each month. It's figured from the balance, often that month's interest (definition, opens in a new tab) plus a small percent of what's owed, with a dollar floor. Because it shrinks as the balance shrinks, paying only the minimum can stretch a payoff out for many years.

Where does this site use it?

• Debt payoff calculator
• What happens if I only pay the minimum on my card?

Related terms

• APR (annual percentage rate)
• Interest
• Compounding

General education, not financial advice.