How does a credit card's interest-free period work?

A card has a billing cycle (usually a month) and a repayment deadline after it ends (usually 20-25 days). If you repay the ENTIRE balance on the statement by that deadline, you pay no interest at all on card purchases. The total interest-free period is the length of the cycle plus the repayment deadline, which is why banks advertise 51 or 56 days - but only a purchase made on the first day of the cycle gets that long.

How much does it cost to repay a credit card with the minimum payment?

A great deal, because the minimum is calculated on the falling balance and gets smaller every month. A PLN 5,000 balance at 20% interest with a 5% minimum takes 78 months to repay, i.e. 6 years and 6 months, and the interest comes to PLN 2,229.75. With a 3% minimum it takes 144 months, i.e. 12 years, and PLN 5,045.86 in interest - more than half of the amount borrowed.

Is a cash withdrawal on a credit card covered by the interest-free period?

No. Cash withdrawals from an ATM, transfers from the card and transactions treated as cash are usually excluded from the interest-free period - interest is charged from the day of the transaction, and on top of that there is a withdrawal fee, most often 3-4% of the amount. It is the most expensive way to use a credit card.

Does closing a credit card improve your borrowing capacity?

Usually yes, because banks count not the debt you have used but the granted limit as a commitment - often taking a few percent of the limit as a hypothetical monthly payment. So an unused card with a PLN 20,000 limit can lower your borrowing capacity even though you owe nothing on it. On the other hand, a long-held, properly managed card builds your history in BIK (Poland's credit bureau), so before applying for a mortgage consider lowering the limit rather than closing your oldest card.

Debt

Credit card: how to avoid paying interest

A credit card is one of the two financial products you can use completely free of charge - and at the same time the most expensive debt on the market. The difference comes down to one decision made once a month. We show what the wrong one costs: PLN 5,000 turns into a 12-year debt and PLN 5,045.86 in interest.

10 min read · 9 September 2026 · Piotr Litwa, KredytPartner

How "51 days interest-free" really works

A credit card is settled in cycles. A cycle usually lasts a month; once it closes, the bank issues a statement and gives you a deadline for repayment - most often 20-25 days. There is one rule and no exceptions to it:

The all-or-nothing rule

You repay the entire balance on the statement on time - you pay zero interest on card purchases. You repay even one zloty less - interest is charged on the whole balance and backdated, usually from the date of each transaction. There is no in-between, no pro rata.

The advertised "51 days" is the length of the cycle plus the repayment deadline. But only a purchase made on the first day of the cycle gets that much interest-free time. A purchase on the last day only gets the repayment deadline itself - in our example 21 days. It is not a scam, that is simply how the arithmetic of the cycle works. The practical conclusion: if you are planning a big purchase on your card, make it at the start of a new cycle, not at the end of the old one. You will find the cycle closing date in your bank's app.

Trap number one: the minimum payment

Every month the bank shows you two amounts: "amount due" and "minimum payment". The minimum is usually 3-5% of the balance, but not less than a few dozen zloty. Paying the minimum protects you from being late and from a negative entry in BIK (Poland's credit bureau) - and that is its only function. It is not a repayment plan. Here is why.

A balance of PLN 5,000, an interest rate of 20% a year, no new transactions. Three scenarios:

How you repay	Time to repay	Interest	Total you pay
Minimum 3% (at least PLN 40)	12 years	PLN 5,045.86	PLN 10,045.86
Minimum 5% (at least PLN 40)	6 years and 6 months	PLN 2,229.75	PLN 7,229.75
Fixed payment of PLN 250	2 years and 1 month	PLN 1,133.03	PLN 6,133.03

With a 3% minimum you pay back twice as much as you borrowed. And not because the interest rate is lethal - 20% is a lot, but not astronomical. The culprit is the way the minimum is structured.

Why the minimum works like a treadmill

The minimum payment is calculated as a percentage of the current balance. The balance falls, so the minimum falls too - and at the same pace. The effect: each month you pay less, so you repay less capital, so the balance falls more slowly.

minimum = max(balance × 3%, PLN 40)

With a balance of PLN 5,000 the minimum is PLN 150, of which about PLN 83 is interest alone - PLN 67 goes towards the capital. With a balance of PLN 2,000 the minimum drops to PLN 60, of which interest is PLN 33 - leaving PLN 27 for the capital. The closer to the end, the slower it goes.

For comparison: at 20% a year, simply carrying a balance of PLN 5,000 costs PLN 2.74 a day, or PLN 82.19 a month. If your payment is close to that amount, in practice you are repaying nothing - you are paying rent on the debt.

One change that fixes it

Set a fixed repayment amount - whatever you can afford to pay today - and do not lower it as the balance falls. The third row of the table is exactly this move: PLN 250 a month instead of a shrinking minimum cuts the repayment from 12 years to 25 months and saves PLN 3,912.83. No need for refinancing, no need to negotiate with the bank - a standing order is enough.

Trap number two: cash withdrawals

This is the most expensive way to use a credit card and the most common reason why people "don't understand where the interest came from, I paid on time". Cash transactions - ATM withdrawals, transfers from the card, and often also buying currency, topping up e-wallets or betting - are usually excluded from the interest-free period. This means:

A fee straight away - typically 3-4% of the amount withdrawn; on PLN 1,000 that is PLN 30-40 before we even count the interest.
Interest from the day of withdrawal - not from the repayment deadline, not from the end of the cycle. From the day of the transaction.
The order in which repayments are applied - card terms usually apply your repayment first to the cheapest debt (purchases) and only then to the most expensive. The effect is the opposite of what you would expect: the cash part is left until last and earns interest for the longest.

If you need cash, practically any other product is cheaper - including an ordinary cash loan, which at a similar rate has a schedule and an end date. The exception is payday loans, which are even more expensive; we take their maths apart in payday loans: why an APR of 1000% is not a mistake.

What a card costs when you "don't use it"

A card with no debt on it is not automatically free. Check three things in your bank's table of fees:

The annual or monthly card fee - often waived conditionally, for example if you spend at least PLN 300-500 a month. The condition is checked every month; one month without transactions means one fee.
Insurance attached to the card - it can be switched on by default and cost a few zloty a month regardless of the balance.
The effect of the limit on your borrowing capacity. This is the most expensive hidden cost. Banks count as your commitments not what you have used, but the granted limit - usually taking a few percent of the limit as a hypothetical monthly payment. So an unused card with a PLN 20,000 limit can lower your mortgage borrowing capacity by tens of thousands of zloty. We describe how this works in a bank's model in how a bank calculates borrowing capacity.

Before applying for a mortgage

Do not close your oldest card on reflex - a long, properly managed history in BIK is an asset. Instead, lower the limit to the amount you actually use. Your borrowing capacity goes up, the history stays. Do it a few months before applying, so the change has time to show up in the report - details in BIK: how to check and improve your report.

When a card really is a good tool

This is not an article telling you not to have a card. Used in one specific way, it is better than cash:

You pay by card and always repay in full. Then you get free trade credit for several weeks, purchase protection and - with some cards - cashback on part of your spending.
An emergency reserve. A card with a limit that you don't use is cheaper than a payday loan on the day a pipe bursts. Provided you treat it like a fire extinguisher, not like an extension of your salary.
Building a credit history. A card that is settled regularly and on time is one of the simplest ways to build a positive history in BIK before your first bigger loan.

If, however, your card balance has not gone down to zero for several months, it is no longer a card - it is the most expensive loan in your wallet and the first candidate to be replaced with something that has a schedule. When such a switch makes sense and when it only postpones the problem, we calculate in the guide debt consolidation: when it makes sense.

Do the maths yourself

Calculator

Overpayment calculator

Want to see how much you gain by paying a fixed amount instead of a shrinking minimum? Enter the card balance as the loan amount, its interest rate and the term, then add an overpayment. The calculator will show how much shorter the repayment gets and how much interest you save. The same engine calculated all the numbers in this article.

Open the overpayment calculator

Read also

Debt consolidation: when it makes sense - how to swap expensive revolving debt for cheaper debt with a schedule.
Payday loans: why an APR of 1000% is not a mistake - the only debt more expensive than cash from a card.
How a bank calculates borrowing capacity - why an unused limit lowers your borrowing capacity.

The numbers in this article were calculated by the engine that powers our calculators (js/finance.js). The 20% interest rate, the 3-5% minimum and the billing cycles are a worked example - rates, minimum thresholds and the list of cash transactions are set by your bank's terms and table of fees, and the upper limit on interest is set by the statutory maximum interest rate, whose level changes with the NBP (National Bank of Poland) reference rate. This text is educational and does not constitute investment advice or an offer within the meaning of Art. 66 §1 of the Polish Civil Code.