We use the “daily balance” method (including new transactions) to calculate the Balances on which we will charge interest. For each day in the Billing Period, we determine the Daily Balance for your Account as follows:
- We start with the beginning balance for each Balance Category (Purchase Transactions, Cash Advances, Balance Transfers, etc.) for the day;
- For each Balance Category, we add an amount equal to the applicable Daily Periodic Rate multiplied by the beginning balance for that Balance Category;
- We add any new Transactions, Cash Advances, and Balance Transfers, as applicable, to the corresponding Balance Category and any corresponding debits, plus any related fees incurred for the current day; and
- We subtract from the balance of each Balance Category; any applicable payments and credits received that day.
This gives us the Daily Balance for each Balance Category for that day. The addition of the prior day’s interest in the Daily Balance calculation causes interest to compound daily. If any Daily Balance is less than zero, we treat it as zero. For each Billing Period, the total amount due will be the sum of the Daily Balances for each day in the Billing Period.