Credit Cards

The minimum payment trap — and how to escape it

Paying only the minimum keeps you out of late fees but not out of debt. See why, and the three ways out.

4 min read22 Oct 2026Intermediate
Gulf Policy Souq Editorial TeamUpdated 22 Oct 2026 · UAE personal finance
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Reading time4 minutes
Key takeaways3 to remember

01Why minimums are so small

The minimum is usually a small percentage of your balance. It's designed to keep the account in good standing, not to clear the debt quickly.

02What it really costs

Credit card interest rates in the UAE are often far higher than loan rates. Paying only the minimum on a large balance can take years and cost much more than you borrowed.

The minimum avoids late fees, not interest.KEY POINT

03Three ways out

Pay more than the minimum every month, move the balance to a lower-cost instalment plan or balance transfer, or consolidate it into a personal loan at a lower rate.

04Stop the balance growing

While you pay it down, switch everyday spending to a debit card so the balance only goes one way.

Try it yourself

Minimum payment simulator

Compare paying only the minimum with a fixed monthly amount. Figures are examples — use your own numbers.

Key takeaways

What to remember

The three points that matter most from this guide.

01

The minimum avoids late fees, not interest.

02

Pay as much above the minimum as you can.

03

Consider a balance transfer or consolidation loan.

Minimum PaymentThe smallest amount you must pay by the due date to avoid a late fee — usually a small percentage of your balance. Interest still applies to the rest.Balance TransferMoving debt from one credit card to another, often at a lower rate for a promotional period.Easy Payment PlanConverting a large card purchase into fixed monthly instalments, sometimes at 0% with a processing fee.Loan BuyoutWhen a new bank pays off your existing loan so you can move to a better rate or combine debts.
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General information only, not financial advice. Rules and bank terms can change — always confirm with your provider.

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