Which Method Used To Calculate Finance Charges Is Most Favorable To The Card Issuer?

The date of payment is unimportant as long as it is made throughout the cycle. The financing fee for that billing cycle is calculated by multiplying the resultant amount once the computations are finished by the monthly interest rate. This is the most advantageous way since it yields the lowest financing charge.

Conclusion

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The “previous balance method” is the most favorable to the card issuer. The previous balance method charges interest on the amount of debt that you have, not your current balance.

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