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Minimum payment

The cardholder must pay a defined minimum portion of the amount owed by a due date, or they may choose to pay a higher amount. The credit issuer charges interest on the unpaid balance if the billed amount is not paid in full (typically at a much higher rate than most other forms of debt). These effects account for roughly 8% of all interest paid. In particular, hiding the minimum payment option for automatic and manual payments, and focusing on the total debt, may mitigate the unwanted consequences of default minimum payments.In addition, if the cardholder fails to make at least the minimum payment by the due date, the issuer may impose a late fee or other penalties. To help mitigate this risk to the consumer, some financial institutions can arrange for automatic payments to be deducted from the cardholder's bank account, thus avoiding such penalties altogether, as long as the cardholder has sufficient funds.

In cases where the minimum payment is less than the finance charges assessed during a billing cycle, the outstanding balance will increase in what is called negative amortization. This practice tends to increase credit risk and mask the lender's portfolio quality, and it has consequently been banned in the US since 2003.

Kindly expatiate pls. U did not post something one can comprehend.