HDFC Credit Card Holders Alert: Bank Announces Major Changes In Your Bill, Customers To Pay More On MAD From April

In an email sent to Credit Card users, the HDFC Bank said that it's making changes in the MAD calculation process. "We are making an important update to the Minimum Amount Due (MAD) calculation on your HDFC Bank Credit Card, effective April 2025," it said.

The HDFC Bank further said that the new calculation method for the Minimum Amount Due would be: "MAD = Total GST + EMI amount + 100% of Fees/Charges + 5% of (Finance Charge + Retail Spends + Cash Advance) + Overlimit Amount (if any)."

It further said that if 5% of (Finance Charge + Retail Spends + Cash Advance) is less than the Finance Charge, then the MAD would be calculated as follows: "MAD = Total GST + EMI amount + 100% of Fees/Charges + 100% of Finance Charges + 5% of (Retail Spends + Cash Advance) + Overlimit Amount (if any)."

The minimum amount due on a credit card refers to the lowest payment a cardholder must make to keep their account in good standing. This amount is usually a small percentage of the total outstanding balance, typically between 5% and 10%, as set by the card issuer. The issuer calculates this minimum payment using a specific formula that takes into account the remaining balance, new transactions, and any applicable fees or charges linked to the card’s usage.

Paying the minimum payment on your Credit Card is important to avoid negative consequences on your Credit Card account and overall financial health. It also helps you maintain a good credit score, which helps you avail loans at better interest rates.