Definition, Meaning & Synonyms

finance charge

noun

/ˈfaɪnæns tʃɑrdʒ/

Definition

A finance charge is the cost of borrowing money or the fee for using credit, expressed as an interest rate or a flat fee.

Examples

If you don’t pay off your credit card balance in full, you will incur a finance charge on the remaining amount.
The finance charge increased due to the delayed payment of the loan.
Understanding your finance charge can help you manage your debts better.

Meaning

It represents the total amount of interest and fees you have to pay on a loan or credit card balance, typically calculated on the outstanding amount over a specific period.