How long to clear an Irish credit card and what it costs in interest.
Months to payoff
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Total interest paid
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Total repaid
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Minimum-only months
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Card stamp duty / year
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Your breakdown
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Why Irish credit card rates are so expensive
Credit cards in Ireland are one of the most expensive forms of consumer debt. At 21% APR, money borrowed on a card costs more than ten times what a three-year personal loan would cost at around 6 to 8% APR. The reason lenders charge higher rates is the revolving nature of the product: they do not know when you will pay, the balances fluctuate, and the administrative costs per euro lent are higher than for a fixed-term loan. For a balance that is cleared every month, those costs do not matter. For a balance that persists month after month, they compound rapidly.
The minimum payment trap is particularly acute in Ireland because most banks set the minimum at just 1% to 2% of the balance plus that month’s interest. At that rate almost nothing is reducing the principal. This calculator shows both your chosen payment scenario and the minimum payment scenario side by side, so you can see exactly how many extra years and how much extra interest you would pay by only meeting the minimum.
Worked example: 4,000 euro at 21% APR
A balance of 4,000 euro at 21% APR. Monthly interest in month one: 4,000 multiplied by 21% divided by 12 = 70 euro. If you pay 200 euro per month, 130 euro reduces the balance in month one. The balance falls each month, so the interest charge falls too, meaning progressively more of each 200 euro payment reduces principal. The balance clears in about 24 months, and total interest paid is roughly 780 euro. If you paid only the minimum of around 1% plus interest, clearing the balance would take over 20 years at a cost of several thousand euro in interest. Paying 200 euro rather than the minimum saves years and thousands in interest on a modest 4,000 euro balance.
The stamp duty and balance transfer options
Every credit card account in Ireland carries an annual stamp duty of 30 euro regardless of whether it is used or carries a balance. This is levied by the card provider on behalf of the state under the Stamp Duties Consolidation Act. It is a small but fixed cost of holding the card. Some Irish banks offer balance transfer promotions at 0% for a period, which can significantly reduce the interest burden if you qualify and transfer the balance immediately. A balance transfer fee of 1% to 3% of the amount moved is typical, but it is usually much less than the interest saved if the 0% period is long enough to clear or substantially reduce the balance.