"The most economical way to use your credit card is to clear the balance in full every month."
Missed payment
When you get a credit card, you’re making an agreement with your lender that in exchange for them providing the funds you need when you spend, you will pay this back at a rate set by the lender. If you don’t stick to this agreement, you could find yourself penalised.
The most economical way to use your credit card is to clear the balance in full every month. This means that you shouldn’t ever have to pay any interest. If you can’t manage this, make sure you pay back at least the minimum repayment set by your lender.
Missing this minimum repayment or paying less than this will show up as a missed payment on your credit report. This is the information lenders use when deciding whether or not to accept a borrower’s application for credit. And if you have a mark like this on your credit file, it could make it difficult for you to borrow in the future.
As well as your credit rating being affected, a missed payment may also result in your lender imposing a charge on you, which you will have to pay on top of your repayment and the interest attached to it. The maximum that lenders are allowed to charge for a missed payment is £12 and many charge just that. This could make managing your outstanding balance more of a struggle. And if your card had any special offers, such as rewards or a limited period low interest rate, your lender may cancel these too. If you’re unable to make your current repayments get in touch with your lender as soon as possible to make them aware of the situation and see if an alternative option can be reached.