The minimum due and revolving card debt

A credit card lets you pay less than the full bill and carry the rest. That is called revolving, and the smallest payment the issuer will accept is the minimum amount due. The Reserve Bank of India’s Directions for banks that issue cards set several limits on how this may work. This page quotes them. Paragraph numbers are those of the Directions as updated on 1 October 2026.

What the rules say

The minimum due must not let the debt grow. Paragraph 23(2) says the terms for paying card dues, including the minimum amount due, must “ensure there is no negative amortization”. Its illustration takes ₹10,000 outstanding, 2% monthly interest of ₹200 and ₹50 of tax and other charges, and says the minimum due “shall not be less than ₹250 (indicative figure)”.
No interest on unpaid taxes and charges. The same paragraph: “Card-issuers shall not capitalize i.e., levy interest or any other charges, on the unpaid taxes/levies/charges.”
Carrying a balance ends the interest-free period. Under paragraph 23(3), the card’s terms must explain that the interest-free period “is suspended if any balance of the previous month’s bill is outstanding”. The Explanation to paragraph 23(6) says that when the total due is not cleared by the due date, the “interest free credit period will be lost, and interest may be levied from the date of transaction”.
Interest is charged on what is actually owed. Paragraph 23(6): “Interest shall be levied only on the outstanding amount, adjusted for payments / refunds / reversed transactions.” Late fees, likewise, apply to the amount outstanding after the due date “and not on the total amount due.”
Every statement must carry a warning. Paragraph 23(3) requires a legend on all bills: “Making only the minimum payment every month would result in the repayment stretching over months / years with consequential compounded interest payment”. Paragraph 23(4) requires issuers to work out examples of this and put them in the welcome kit and on their website.
Late fees and bureau reports wait three days. Paragraph 23(5): an issuer may report an account as past due to a credit information company, or levy late payment charges, “only when a credit card account remains ‘past due’ for more than three days”. The days are counted from the due date printed on the statement.
The rate and the annual fee must be equally visible. Paragraph 23(1): “The APR charged, and the annual fee shall be shown with equal prominence.”
You must be told before a default is reported. Paragraph 36 requires an issuer to “intimate the cardholder prior to reporting of the status” as a defaulter. If the cardholder later settles, “the card-issuer shall update the status with CIC within 30 days from the date of settlement”.
An EMI with interest cannot be called free. Paragraph 12(3): “EMI conversion with interest component shall not be camouflaged as zero-interest / no-cost EMI.” More on this under pay-later, cards and no-cost EMI.

What the rules do not say

They do not set a formula. The Directions say what the minimum due must achieve, not how to build it. Issuers choose. SBI Card’s notice of a formula effective 15 July 2025 lists the month’s GST, EMI amount, fees and charges and finance charges, each in full, any amount over the limit, and “2% of remaining balance outstanding”. An older and still common pattern is a flat percentage of the amount outstanding. Your own card’s formula is in its terms and on the statement.

They do not make the minimum due a good plan. A minimum that covers the month’s charges and a small slice of the balance satisfies the rule and can still take many years to clear a card. The minimum due calculator shows how many.

What this means for arithmetic

Three things in the Directions shape any honest calculation of card debt:

A compliant minimum due is at least the month’s interest and charges, so the balance should fall, or at worst stand still, when only the minimum is paid and nothing new is spent.
Interest should never be computed on unpaid GST or fees.
New spending on a card that is carrying a balance earns no interest-free days. Our calculator assumes no new spending for this reason, and says so.

What we could not confirm

Whether issuers other than commercial banks follow identical wording. Separate Directions exist for other kinds of issuer, and we have not read all of them.
The wording of paragraph 23(5) as it will stand from 1 April 2027. The amending Directions keep the three-day rule. We did not compare the two texts line by line.
Whether the Directions limit the interest rate an issuer may charge. Paragraph 23, read for this page, covers disclosure and method. We did not check the rest of the Directions for a ceiling.
The rate of GST on card interest from a government notification. Issuers state that GST applies at the prevailing rate, and their examples use 18%.