Credit card minimum payment: what it really costs (UAE)
Updated
What is credit card APR in the UAE?
UAE card rates are often quoted per month: 3.25% a month is 39% a year simple, and 46.78% as the APR a bank must disclose, which compounds the monthly rate over a year. On a balance you carry, UAE banks may not charge interest on interest already added, so what you actually pay is closer to the 39% simple figure. There is no cap on card rates, so check the rate on your statement — the rates in the table are examples, not offers.
| Monthly rate | × 12 (simple, closest to what you pay) | APR (compounded, as disclosed) |
|---|---|---|
| 2.5% | 30% | 34.49% |
| 3% | 36% | 42.58% |
| 3.25% | 39% | 46.78% |
| 3.5% | 42% | 51.11% |
Official rule: There is no cap on credit card interest or profit rates; the rule only says banks must not charge excessive rates. The rate must be shown on every statement. (source, checked 2026-10-19)
Example: AED 20,000 on a card at 36% a year, no new spending. If the minimum is 5% of the balance (at least AED 100) and you pay only that, the card takes 11 years 5 months to clear and costs AED 26,211 in interest — more than you borrowed. If the minimum is the month's interest plus 5%, it takes 5 years 5 months and AED 11,430. Paying AED 1,180.95 a month clears it in 2 years for AED 8,343. Your card's rate and minimum rule are on your statement.
Minimum only, year by year
Not a valid document. Estimate for information only — not financial advice, not an offer of credit and not a bank document. Errors are possible. Only your bank's or finance company's official offer letter, contract and statements are binding.
Why the minimum is a trap
The minimum is a share of what you owe. As the balance shrinks, so does the minimum, so each month you pay a little less and the debt drags on. Early on, most of the minimum is interest. With a fixed amount every month instead — even just your first minimum, kept the same — the balance falls faster each month and the interest drops with it.
What the rules say
- No official minimum. The Central Bank sets no minimum payment and no cap on card rates; each bank decides. That is why this page asks for your card's rule.
- Your statement must warn you. Every statement must show how long the balance takes to clear and the total interest if you only pay the minimum, plus a warning sentence. Look for it.
- Pay in full, pay no interest. Pay the whole statement balance by the due date and no interest is charged on purchases. Pay part of it and interest runs on the rest from the due date. Cash withdrawals are charged from the day you take them.
- Late fee. Missing even the minimum costs a late fee of at most AED 230 + VAT, and it goes on your credit record.
- No interest on interest. Banks may not charge interest on interest already added.
A cheaper way out
Card rates are far above personal loan rates. If the balance is large, compare moving it to a personal loan with the personal loan calculator — the loan's instalment is fixed, so it ends on a date, and all your instalments together must stay within 50% of your salary.
Every card limit also counts in that 50%, used or not. To see how much room your cards take — or how much limit you could still get — use the credit card limit calculator. Choosing a card? Check whether its annual fee is worth it.
Questions people ask
How long does it take to pay off a credit card paying only the minimum?
In the UAE, often many years, because the minimum shrinks as the balance shrinks. Your statement must show the exact time and total interest for your card; this calculator shows the same for any balance.
Is there interest if I pay my credit card in full?
No — in the UAE, pay the full statement balance by the due date and no interest is charged on purchases. Cash withdrawals are the exception: they are charged from the day you take them.
What is the late payment fee on a UAE credit card?
At most AED 230 plus VAT, under the Central Bank's fee caps, in the UAE.
What is the minimum payment on a credit card?
Whatever your bank sets: in the UAE the Central Bank sets no minimum payment. Most cards use a percentage of the balance with a floor in dirhams, or the month's interest plus a percentage. The amount is on your statement, with how long paying only the minimum would take.
What happens if I only pay the minimum payment on my credit card in the UAE?
In the UAE, the balance shrinks very slowly and you pay far more interest. Example: AED 20,000 at 36% a year with a minimum of 5% (at least AED 100) takes 11 years 5 months to clear and costs AED 26,211 in interest. Your statement must show how long paying only the minimum takes for your card.
How to calculate interest in credit card?
Card interest in the UAE is charged on the reducing balance, day by day on a 365-day year, from your average daily balance: roughly balance × yearly rate ÷ 365 × days. Pay the full statement balance by the due date and there is no interest on purchases; cash withdrawals are charged from the day you take them.