Credit Term

Grace Period

The interest-free window on credit-card purchases — usually around 20 days between your statement date and payment due date. If you pay your statement balance in full, you pay no interest on those purchases at all.

When you buy on a credit card, you are not charged interest immediately. As long as you clear the full statement balance by the due date, the grace period means those purchases cost you nothing extra — this is what makes a credit card a genuinely useful, free tool for people who pay in full.

The grace period disappears the moment you carry a balance. Once you pay less than the full amount, interest starts accruing on the outstanding balance, and often on new purchases from the day they are made, until you clear it entirely again. Cash advances usually get no grace period at all and are charged from day one. The habit that unlocks the benefit is simple: pay the statement in full, every month.

Useful guides & tools

Related terms