Interest on Your Account

How interest is calculated and applied to your Capital on Tap Business Credit Card account.

Overview

This article explains how interest is applied to your Capital on Tap account, including how different transactions are treated, and answers to common questions about interest charges.

How interest is calculated and applied

• Card purchases and Bill Pay payments: Interest is calculated daily. If you don't pay your full outstanding balance by the payment due date, interest is charged on your card purchases from the date each purchase was debited from your account.

• ATM withdrawals and drawdowns: Interest is always applied daily on ATM withdrawals and drawdowns, until the funds have been paid back in full. Repayments are applied to any outstanding cash balance (ATM withdrawals and drawdowns) before they're applied to your card balance.

Your monthly statement will show interest as either an 'Interest Charge' or a 'Card Interest Charge'.

An 'Interest Charge' includes interest on drawdowns, card purchases, and ATM withdrawals. This charge is applied on the last day of the billing period, for the current period's interest.

A 'Card Interest Charge' is the interest for card purchases. This charge appears on your statement on the business day after the payment due date, if the full balance from the previous billing period was not paid.

What is the interest-free period?

You can receive up to 42 days interest-free on card purchases if you pay your full outstanding balance by your payment due date. This period runs from the first day of your billing period until your payment due date, 42 days is the maximum time between the two.

If your balance isn't cleared by the due date, you're charged interest on your card purchases from the date each purchase was debited from your account, until you next pay your outstanding balance in full. This appears on your statement at the end of each billing period as an 'Interest Charge'.

Important: ATM withdrawals and drawdowns will always incur interest, the interest-free period doesn't apply to them.

What happens if I pay my balance partially?

If you pay your balance partially, you will be charged interest on your card purchases from the date each purchase was debited from your account, until you next pay your outstanding balance in full. To avoid interest charges, you must pay the full outstanding balance by the payment due date.

Why have I received interest charges?

If your payment option is set to 'Fixed' or 'Minimum', and you do not pay your outstanding balance in full by the due date, you will be charged interest on your card purchases. This interest is calculated from the date of the purchase until you next pay your outstanding balance in full. If you want to stop incurring interest on card spend, you can change your payment option to 'Full Balance' on the 'Payments' page of your online portal.

If you have made a drawdown or ATM withdrawal, you will accrue interest daily from the date of the withdrawal until the funds are repaid.

Why have I been charged interest twice?

The 'Interest Charge' on your statement is the total interest accumulated throughout the billing period on your daily outstanding balance. This can include interest from both card transactions and ATM withdrawals. The 'Card Interest Charge' is applied the business day after your payment due date, if the full outstanding balance from the previous billing period was not cleared. You are not being charged twice for the same billing period — these are two separate charges that appear at different times.

How often will I be charged interest?

In the first month your account becomes interest-bearing, because you didn't pay your card spend in full, you'll see two charges: a card finance charge and a finance charge.

How do I get interest-free back?

To get back to an interest-free period:

• Pay your balance in full for one billing period.

• This only applies to card spend.

• ATM withdrawals and drawdowns will always incur interest.

How is my interest calculated?

Interest is calculated daily on your card purchases, from the date each purchase was debited from your account. To easily review your interest charges, check 'Card Finance Charge' or 'Finance Charge' on your monthly statement.

What is my APR, and where can I find it?

Your APR was shown in your Revolving Credit Facility Agreement, which you signed when you first joined. Your current APR can always be found on your online portal, under 'Your account' > 'Credit limits and rates', and it's also shown on your monthly statements.

We charge daily compounding interest, which changes in line with your outstanding balance. You can maintain 0% interest on all card spend, provided you pay in full by your payment due date.

How do you charge interest? 

All card spend is interest-free if you pay the outstanding balance in full by your payment due date.

The interest-free period runs from the first day of your billing period to your payment due date.

If the balance isn't cleared by the due date, you are charged interest on your card purchases, from the date each purchase was debited from your account, until you next pay your outstanding balance in full. This appears on your statement at the end of each billing period as an 'Interest Charge'.

Where can I see confirmation of how interest is charged?

Your interest rate is shown in bold at the end of every page of your monthly statement. This outlines the interest rate for your account.

Interest charges are dated to the end of your billing period, and can be viewed in the 'Activity' tab in your online portal.

You can also review your interest rates on the portal, or initially in your Business Credit Card Agreement (the contract):

1. Log in to your Capital on Tap online portal.

2. Click on the 'Your account' tab.

3. Click 'Credit limits and rates'.

4. Click 'Download' next to 'Credit line contract', or view your interest rates below.

When you open your account, we send an email confirming how interest is calculated. For reference, the subject line is: 'Business funding for the real world. Here's how your account works' / 'You're all set — here's a quick reminder of how everything works.'

Section 4.3 of the contractual agreement states: 'Interest will accrue on Cash Withdrawals on a daily basis from the time debited from your account until paid.'

For more on how our variable interest rates are calculated and how they can change, see Understanding Your Variable Interest Rate.