Monthly Maintenance Fee
Monthly Maintenance Fee refers to a recurring charge that some credit card issuers apply to an account each month simply for keeping the account open, regardless of usage or balance. This is evaluated within APR, Interest & Fees.
Plain-Language Meaning
A monthly maintenance fee is a set amount of money that is automatically billed to your credit card account every month as a cost of having the card, separate from interest or transaction-based fees.
Practical Example
If your credit card has a $5 monthly maintenance fee, you will see a $5 charge on your statement every month, even if you do not make any purchases or carry a balance.
What It Does Not Mean
This term does not refer to interest charges, late payment fees, or annual fees, which are separate types of charges that may also apply to credit card accounts.
How the System Uses It
The system evaluates monthly maintenance fees as part of the total cost of holding a credit card, factoring them into the overall fee structure when presenting card details or calculating the ongoing expense of account ownership.
Common Misconceptions
- “Monthly maintenance fees are only charged if you use your card.” The fee is typically charged regardless of whether the card is used.
- “All credit cards have a monthly maintenance fee.” Many credit cards do not charge this fee.
- “Monthly maintenance fees cover late payments or over-limit charges.” These fees are separate from penalties for late payments or exceeding your credit limit.
Related Pages
Related Glossary Terms
FAQ
- Can a monthly maintenance fee be waived? Some issuers may waive the monthly maintenance fee under certain conditions, such as meeting a minimum spending requirement or enrolling in specific programs, but this varies by card and issuer.
- Is a monthly maintenance fee the same as an annual fee? No, a monthly maintenance fee is charged every month, while an annual fee is charged once per year; both are separate charges that may apply to a credit card account.