Credit Card Payoff Calculator
Credit Card Payoff Calculator
How many months to clear a credit card balance at a fixed monthly payment, and how much interest it costs — using the monthly rate Indian cards quote, or an annual one.
Card payoff
A card balance of $1,00,000 at 3.5% a month, paying $10,000 a month
Months to clear a balance
- B
- the balance
- M
- the fixed monthly payment
- r
- the monthly rate: the % a month ÷ 100, or the annual rate ÷ 1200
- n
- months, rounded up to a whole payment; no answer when M ≤ r × B
Worked example
A card balance of $1,00,000 at 3.5% a month, paying $10,000 a month
r = 3.5 ÷ 100 = 0.035 a month (42% a year as quoted; 51.1% compounded)
r × B ÷ M = 0.035 × 1,00,000 ÷ 10,000 = 0.35
n = −ln(1 − 0.35) ÷ ln(1.035) = 12.52 → 13 months
Twelve payments of $10,000 and a last one of $5,265; interest $25,265
1,00,000 at 3.5% a month: payoff by payment
| Monthly payment | Months | Total interest |
|---|---|---|
| $4,000 | 61 | $1,41,803 |
| $5,000 | 35 | $74,989 |
| $7,500 | 19 | $37,071 |
| $10,000 | 13 | $25,265 |
| $20,000 | 6 | $11,922 |
What a card balance really costs
Card interest is expensive because the rate is high and it compounds. Indian issuers quote it as a monthly rate — 3.5% a month is 42% a year as quoted, and 51.1% once a year of monthly compounding is counted. The only way the balance falls is a payment larger than the month’s interest; the further above it you pay, the faster the balance goes, as the table shows.
This page makes three simplifications, and each one flatters the result. It charges interest once a month on the balance, whereas cards usually charge daily on the average daily balance from the date of each transaction. It assumes you stop using the card; on most cards, carrying any balance forward also ends the interest-free period, so new purchases are charged interest from the day they are made. And it leaves out tax and fees: in India GST is charged on card interest and fees, as issuers’ terms state, which adds to the real cost. Treat the months and interest here as the best case.
The Reserve Bank of India requires card issuers to quote an annualised percentage rate for each kind of balance and to explain in their Most Important Terms and Conditions how interest is charged. If you have balances at different rates — purchases, cash advances, a balance transfer — work each out separately, and pay the dearest first. Converting a balance into a lower-rate EMI or a personal loan can cut the cost; the EMI calculator shows what that EMI would be.
The chart shows the balance falling and interest paid rising. In the example the card is clear within 2 years; to see what paying only the minimum would do, use the credit card minimum payment calculator. This is arithmetic on the figures you enter, not financial advice.
Frequently asked questions
How long will it take to pay off my credit card?
Months = −ln(1 − r × balance ÷ payment) ÷ ln(1 + r), with r the monthly rate. $1,00,000 at 3.5% a month, paying $10,000, takes 13 months and about $25,265 of interest.
Is 3.5% a month the same as 42% a year?
42% is how cards quote it (monthly × 12). Compounded monthly it is 51.1% a year. The page uses the monthly rate either way.
Why is my card’s interest different from this?
Cards usually charge interest daily on the average daily balance, charge it on new purchases once a balance is carried, and in India add GST to interest and fees. This page uses a monthly approximation with no new spending.
Why does the calculator show nothing?
Your payment does not cover a month’s interest, so the balance never falls. Pay more each month.
Related calculators
References
- Reserve Bank of India. Master Direction – Credit Card and Debit Card – Issuance and Conduct Directions, 2022. RBI/2022-23/92, DoR.AUT.REC.No.27/24.01.041/2022-23, 21 April 2022 (as amended). Para 9(b): card-issuers must quote APRs, ensure there is no negative amortisation, and not capitalise unpaid charges, levies or taxes for charging interest.
- Examples of issuers’ published Most Important Terms and Conditions (MITC), consulted September 2026: Federal Bank credit cards MITC (minimum amount due 5% of the total amount due, minimum Rs 100, plus EMIs, GST and fees; interest by the average daily balance method; GST on interest and charges; rates revised from 10 January 2026) and SBI Card MITC (minimum amount due 5% of total outstanding, minimum Rs 200, plus taxes, EMIs and any over-limit amount). Cited for the convention only; each issuer sets its own terms.
- Brealey RA, Myers SC, Allen F. Principles of Corporate Finance. McGraw-Hill. The present value of an annuity, from which the level-payment loan formula and its inverse for the number of payments follow.