Minimum credit card payment will increase on 1is August, to increase to 2.5% of the balance.
This is the first half-point increase provided for by the Consumer Protection Act, in order to increase the minimum payment in 2025 to 5%.
This measure applies to credit card contracts signed before 1is August 2019. New contracts are already subject to the minimum payment of 5%.
As an example, for a card with a balance of $ 1,000 and 19.9% interest rate, repayment with minimum payments at 2.5% would take 14 years and 7 months and $ 1,443.99 interests. At 5% of the amount, the repayment would be made over six years, for $ 441.87 in interest.
The Office de la protection du consommateur reminded that the purpose of this increase is to prevent over-indebtedness and that people who have difficulty making these payments should consider it as a signal to seek advice from personal finance specialists who work within consumer associations.
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