Interest saving balance is a term used in credit cards and loans that refers to the minimum amount that a cardholder needs to pay each month to avoid any additional interest charges. It is the sum of the minimum monthly payment required by the credit card company plus all the new purchases made during the billing period. When a cardholder chooses the interest saving balance option, they wont pay off their entire balance earlier than intended, and theyll still avoid interest on new purchases.
The interest saving balance is a relatively new feature that banks have started offering to help customers avoid paying interest. However, there are some drawbacks to using this option. If a cardholder still has a balance, they may pay a larger minimum interest charge, and it can add up over time. Therefore, it is always best to pay off the entire balance instead of incurring interest if possible.
In summary, interest saving balance is a minimum payment option that allows cardholders to avoid paying interest on their credit card balance. However, it is important to understand the drawbacks and to pay off the entire balance whenever possible to avoid accumulating interest charges over time.
