Credit Card Interest Calculator — Daily, Monthly & Annual Charges
Find out exactly how much interest a credit card balance costs per day, per month and per year — enter your outstanding balance and the card's APR.
%
Approximate interest added to your statement each billing cycle
- 1
Monthly rate
20% ÷ 12 ÷ 100 = 0.016667 - 2
Monthly interest charge
5,000 × 0.016667 = 83.33Approximate — issuers use daily compounding on the average daily balance.
How does this calculator work?
Daily interest = balance × (APR ÷ 365). Monthly interest ≈ balance × (APR ÷ 12). Annual interest = balance × APR. On a $5,000 balance at 20% APR you pay roughly $83/month in interest — money that goes entirely to the lender without reducing your debt.
Formula
How this is calculated
Credit card issuers convert your APR into a Daily Periodic Rate (DPR = APR ÷ 365) and multiply it by your average daily balance across each billing cycle to produce the monthly interest charge on your statement. This calculator shows both the daily figure and the common monthly approximation (APR ÷ 12) so you can see the per-day cost alongside the billing-cycle impact.
The annual charge shown is simply balance × APR ÷ 100 — valid only if the balance stays constant, which it will not if you make payments or new purchases. In practice, unpaid interest compounds: it is added to the balance, and the following month's interest is calculated on the larger figure, making the true annual cost slightly higher than the simple product.
Knowing the daily rate is useful for timing payments: paying your bill a few days earlier reduces the average daily balance and therefore the interest charge for that cycle. On a $5,000 balance at 20% APR, every day you wait costs about $2.74 — making even a partial early payment worthwhile.
Frequently asked questions
The issuer converts your APR to a Daily Periodic Rate (APR ÷ 365), multiplies it by your average daily balance for each day of the billing cycle, and sums those daily charges. Paying the full statement balance before the due date avoids all interest charges entirely.
The DPR is APR ÷ 365 — the fraction of your balance charged as interest each day. For a 20% APR card, DPR ≈ 0.0548% per day. Multiplied by your balance and the days in the cycle (typically 28–31), it gives the monthly interest charge.
It is an approximation using APR ÷ 12. Your actual statement charge may differ slightly because issuers use daily compounding on the average daily balance, which changes whenever you make a payment or purchase mid-cycle. The difference is usually small but can be meaningful with large mid-cycle transactions.
Also known as
TG we-Calculate Editorial Team. (2026). Credit Card Interest Calculator — Daily, Monthly & Annual Charges [Online calculator]. TG we-Calculate. https://we-calculate.com/calculator/credit-card-interest-calculator
TG we-Calculate Editorial Team. "Credit Card Interest Calculator — Daily, Monthly & Annual Charges." TG we-Calculate. 2026. https://we-calculate.com/calculator/credit-card-interest-calculator.
TG we-Calculate Editorial Team, "Credit Card Interest Calculator — Daily, Monthly & Annual Charges," TG we-Calculate, 2026. [Online]. Available: https://we-calculate.com/calculator/credit-card-interest-calculator
@misc{wecalculate_credit_card_interest_calculator, title = {Credit Card Interest Calculator — Daily, Monthly & Annual Charges}, author = {{TG we-Calculate Editorial Team}}, howpublished = {\url{https://we-calculate.com/calculator/credit-card-interest-calculator}}, year = {2026}, note = {TG we-Calculate} }
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