Credit card finance charges can be confusing as they are different from a normal simple daily interest consumer loan, because billing cycles play a part in the finance charge calculation. Both current and previous billing cycles are required for the calculation to qualify for a configured grace period. Grace period flags are determined by the credit union and disclosed in their credit card disclosures.

Finance charges are waived if the account qualifies for the grace period configured in the loan category by each Balance Category (Cash Advance, Balance Transfer or Purchases). This is best explained by an example assuming the Purchase Charge Type (or commonly referred to as the "Purchases Bucket") has a grace period turned on:

Members qualify for a grace period waiver for purchases made in a selected month if they have paid in full the purchase balance of purchases made in the previous payment cycle. Otherwise, they do not qualify. For example, if a member does not pay the purchase balance for the May billing cycle in full by June 25th (end of the current billing cycle), the member is not eligible for the grace period with respect to purchases made during the June billing cycle, regardless of whether the consumer pays the purchase balance of the June billing cycle in full by July 25th.

One of the easiest ways to determine if the member qualifies for the grace period or not is to use Member Inquiry or Phone Operator. Choose the credit card loan, then select the Credit Card Inq tab on the left. On this next screen choose the History tab on the bottom left. The column titled "Prev Unpaid Min Due" will show if the member met the grace period requirements by showing the due amount of $0.00 for the previous billing date.

We provide full details for online credit card set up using the link below for our Credit Card Configuration Guide.