How does a credit card work?

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When you pay by credit card you borrow from the issuer and collect your purchases on one monthly invoice. Pay the full amount by the due date and purchases are interest free for up to 50 days (Morrow Bank). Pay only the minimum and the effective rate, from 21.66% upwards, applies to the rest. Cash withdrawals and spending abroad may carry their own fees. The credit limit is the most you can spend, set individually after a credit assessment. In our selection limits go up to NOK 200,000 (TF Bank Mastercard). Your actual limit may be lower than the maximum. The interest-free period applies to ordinary purchases as long as the previous invoice is paid. Instabank has no interest-free period, so interest there accrues from day one. Cash withdrawals usually carry interest from the day of withdrawal even when purchases are otherwise interest free. Each month you get an invoice with a minimum amount and a due date. The smartest move is to pay it in full, ideally by direct debit or eInvoice, so you never pay interest. Then you keep the benefits, such as rewards and insurance, without the cost.

How does a credit card work?

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