Glossary
Credit card (and how to track it)
A short-term credit line repaid in a monthly cycle, with interest if unpaid in full.
Definition
A credit card is a short-term credit line issued by a bank, letting the holder spend up to a limit and repay the full balance (or a minimum) by a monthly due date. Spending above the credit limit is typically rejected. Unpaid balances accrue interest at high effective annual rates — 30–42 % per year is normal in India.
Key points
- Paying only the minimum due is the most expensive form of borrowing most people ever do.
- Interest-free period applies only when the previous balance is paid in full.
- Statement and due dates are not the same — the gap is the grace period.
- A finance tracker records the spent balance (a liability) and the credit limit (not net worth), not the available limit.
Related
Track this in Extrack
Definitions are step one. Step two is a ledger that uses them — Extrack rolls every account, bill, EMI, and SIP into one live picture, without a bank login.
Start free — 30 days, no card