Banking
Minimum Payment
Also known as: Minimum Amount Due, MAD
The smallest amount that must be paid by the due date to keep the credit card account in good standing.
Detailed Explanation
Minimum payment, typically 2-5% of outstanding balance, is the minimum amount required to avoid late fees and maintain card validity. However, paying only minimum amount attracts high interest (24-48% annually) on remaining balance and can lead to debt accumulation. Always aim to pay full amount.