What's Up In Finance?
DID YOU KNOW?
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Every time a customer uses a credit card, they're borrowing money from a bank in order to pay for a purchase. At the end of each month, the customer gets a statement from the bank listing everything he or she purchased with the credit card, along with the total debt owed to the bank. If a customer pays back all the money owed for that month (the balance), that's it! Easy!

But wait a second. If the customer DOESN'T pay back all the money owed, the bank starts charging interest on the debt. "Interest" is an extra amount that must be paid on top of the original debt.

Remember: Interest is the cost of borrowing money. It is an extra amount that must be paid in addition to the original amount borrowed.

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