How a credit card statement works

In a nutshell

The statement is your credit card's monthly bill. It brings together everything you bought on the card during a period and shows how much to pay and by when. Paying the full amount avoids interest. Paying only the minimum leaves the rest of the debt as revolving credit, one of the most expensive kinds of credit.

What goes on the statement

The statement includes:

• purchases made on the card since the last statement;
• installments of purchases split into monthly payments that fall in that month;
• recurring charges, like streaming or apps;
• fees, such as an annual fee, if your card charges one;
• interest and charges, if the previous statement was not paid in full.

Each purchase lands on a statement according to the card's closing day. There is a separate guide about closing and due dates.

Full payment, minimum and revolving credit

Full payment: you pay everything on the statement. No interest.

Minimum payment: the smallest amount the bank accepts. The rest does not disappear. It becomes a debt called revolving credit ("rotativo" in Brazil), with high interest, and it shows up on the next statement.

Two Brazilian rules help limit the damage. Under a rule from Brazil's National Monetary Council, revolving credit can only last until the next statement's due date. After that, the bank may offer to split the balance into installments, on better terms than revolving credit. And, under Brazilian law, since January 2024, interest and charges (such as late fees, default interest and service fees) from revolving credit and from statement installment plans, added together, cannot exceed the original debt. Taxes, such as IOF (a Brazilian tax on credit), are outside this cap. Even with these rules, a debt can nearly double.

Example

Marta earns R$ 2,500 a month (R$ is the Brazilian real). Her May statement looked like this:

• Groceries: R$ 400
• Pharmacy: R$ 100
• Installment 3 of 10 for the fridge: R$ 300
• Fuel: R$ 150
• Streaming subscription: R$ 50

Total: R$ 400 + R$ 100 + R$ 300 + R$ 150 + R$ 50 = R$ 1,000.

Suppose the minimum is R$ 150. If Marta pays only the minimum, R$ 1,000 − R$ 150 = R$ 850 goes into revolving credit. Suppose interest of 10% a month, just as an example. One month of interest is R$ 850 × 10% = R$ 85. On the June statement, that debt shows as R$ 850 + R$ 85 = R$ 935, plus new purchases and fridge installment 4.

Under the 2024 rule, interest and charges on those R$ 850 cannot exceed R$ 850. So, in the worst case, the debt reaches R$ 850 + R$ 850 = R$ 1,700, plus taxes such as IOF.

Marta's card limit is R$ 3,000, more than her salary. The limit is only the most the bank lets you use. It is not your money. Everything you spend will have to come out of your income later.

Step by step

1. Open your current statement and read it line by line. Mark anything you do not recognize.
2. Compare the statement total with the money left after this month's fixed bills.
3. Pay the full amount whenever you can. If you cannot, pay as much as possible, not just the minimum.
4. If the statement does not fit this month, call the bank before the due date and ask for the statement installment terms, including the CET (total effective cost: the full cost of the debt with interest and fees). Compare before you accept.
5. In Meu Gasto, add your card with its closing day and due day and record your purchases on it. The app shows each month's statement and the installments coming up.
6. Use the app's "Ask" feature to check whether a purchase fits before you swipe the card.

Common mistakes

• Thinking the minimum keeps you up to date. It avoids being late, but the rest becomes debt with interest. Pay in full or as much as you can.
• Treating the limit as income. The limit is credit, not salary. Plan spending around what you earn.
• Not checking the statement. Duplicate charges and forgotten subscriptions slip by. Read it every month and dispute errors with the bank.
• Forgetting future installments. Today's installment adds to tomorrow's purchases. Look at the coming months before splitting another purchase.