Managing credit card debt

Credit cards are a convenient way to pay for big and small transactions. They often come with a range of benefits. But if you don’t make your credit card payment on time, you risk falling into credit card debt.

Card debt builds up if you use your credit card to buy goods or services but don’t pay off the full amount by the end of the billing cycle. You get charged interest on the remaining balance, and this interest can build up rapidly, leading to debt.

Here are some factors to bear in mind if you fall behind on your credit card payments:

Paying off your credit card in a smart way can reduce your interest payments and save you money. Here are some ways to help with credit card debt:

Start by getting a good picture of your debt situation. Look at all your credit card statements and note what you owe, what interest you’re paying, and the minimum payment for each card.

Focus on paying off the card (or any other debt) with the highest interest rate first, while keeping enough money aside to make the minimum payments on others.

Review your monthly income and spending, and identify areas where you can cut costs. You can then work out how much you can afford to repay every month and redirect any savings towards paying your priority debts.

If you can, pay more than just the minimum payment. Even a small increase in what you pay can have a significant impact on reducing your debt faster. Ideally, try to pay off your balance in full every month to avoid being charged interest and building up card debt. 

Setting up a direct debit for card repayments can also ensure you pay at least your minimum balance on time. 

See our repayment calculator.

Consider transferring your high-interest credit card debt to another credit card with a lower interest rate.

If the interest on your card debt is higher than the interest you’re earning on any savings you may have, you could consider paying off your debt first and then replenishing your savings.

Sometimes, managing high credit card debt requires additional strategies. Some loan options might help.

If you have another credit card, overdraft or loan, you may want to think about debt consolidation. A personal loan can merge multiple credit card debts into a single loan with a lower interest rate. It can help you simplify repayments and reduce stress.

Credit card loan debt only increases over time. If you need more time to repay your balance, consider a spending instalment plan. This allows you to turn your credit card transactions or statement balance into as many as 60 monthly instalments, giving you more flexibility and control.

Find out more about Personal Instalment Loan Consolidation and our Spending Instalment Plan

A credit card can be an easy and inexpensive way to pay for your daily necessities – if you use it wisely. Just remember to stay on top of your spending and pay at least the minimum balance on time or you'll start piling up card debt. 

If your circumstances change and you fall behind on debt repayments, help is available. Reaching out to your bank and taking the right action at the right time can help you get back on track. Read more about getting financial help.

To find out more about personal loans, feel free to call us on (852) 2748 8080, or apply online now.

To borrow or not to borrow? Borrow only if you can repay!