Definitions for

**"Average daily balance"****Related Terms:**Average daily balance method, Adjusted balance, Previous balance, Adjusted balance method, Interest free period, Billing date, Current balance, Revolving account, Average collection period, Days sales outstanding, Daily interest, Billing period, Days of grace, Dso, Balance, Billing cycle, Charge account, Revolver, Charge card, Aging of accounts receivable, Exact interest, Daily periodic rate, Average ticket, Minimum monthly payment, Billing statement, Terms, Monthly statement, Annual percentage yield, Automatic payment, Due date, Monthly minimum, Collection ratio, Accounts receivable turnover, Past due, Apy, Chargeback period, Late charges, Minimum payment, Cash advance, Account balance, Payment due date, Interchange rate, Periodic rate, Credit period, Cash advances, Dividend rate, Available credit, Grace period, Average life, Posting date

The average daily balance is a common way for card issuers to calculate finance charges. The card issuer finds the balance each day of the billing period, adds the daily balances together and divides by the number of days in the period. The calculation includes new purchases and payments. You should refer to your credit card issuer's Cardmember Agreement for specific information and details regarding the calculation of the Average Daily Balance.

Account balances for each day of the month are added together, then divided by the number of days in the billing cycle. This is used to calculate finance charges.

An amount calculated by dividing the balance outstanding at the close of each day during the billing cycle by the number of days in that cycle. Used to calculate the interest due on the outstanding account balance.

A method used to calculate finance charges on your credit card or the balance on your savings account. For credit cards, it is calculated by adding the outstanding balance on each day in the billing period and dividing that total by the number of days in the billing period. The calculation includes new purchases and payments. For savings accounts, it is calculated by adding the daily savings balance divided by the number of days in the month.

This is a method by which many creditors calculate Finance Charges. Adding each day's balance and dividing that total by the number of days in a Billing Cycle determines an Average Daily Balance. The Average Daily Balance is typically multiplied by the Periodic Annual Percentage Rate in order to calculate the amount of Finance Charges assessed on an account.

The average account balance for a billing cycle. Your finance charge will be based on this balance. You can figure out your average daily balance by adding the balances of each day of the cycle together and then divide them by the number of days in the cycle.

Method of calculating finance charges where the annual percentage rate is applied the average balance during the billing cycle that is being calculated.

The balance that results from adding together all the daily balances of a credit account in the billing cycle and dividing by the number of days in the billing cycle. This balance is often used to calculate finance charges.

A method for calculating interest in which the balance owed each day by a customer is divided by the number of days.

This is the amount on which your finance charges are calculated. For example, if your average balance is $1,000 and the APR is 12% (1% for one month), your finance charges will be about $10. There are a number of ways that the card issuer can calculate this balance. See Methods of Computing Average Daily Balance.

The most common method banks use to calculate your interest. In calculating your average daily balance, the bank simply adds up your daily balances in any given billing cycle, and divides that number by the number of days in the billing cycle (the billing cycle is the time between your current and pervious bills).

This is the most common calculation method. It credits your account from the day payment is received by the issuer. To figure the balance due, the issuer totals the beginning balance for each day in the billing period and subtracts any credits made to your account that day. While new purchases may or may not be added to the balance, depending on your plan, cash advances typically are included. The resulting daily balances are added for the billing cycle. The total is then divided by the number of days in the billing period to get the "average daily balance."

The average daily balance is the preferred method by which credit card companies calculate your payment due. It is formulated by adding every day's balance and then dividing the total by the total number of days in the billing cycle. This average daily balance is then multiplied by the credit card's monthly periodic rate, which is determined by dividing the annual periodic rate by 12. A card with an annual rate of 18 percent would have a monthly periodic rate of 1.5 percent. If that card had a $500 average daily balance it would yield a monthly finance charge of $7.50.

Most credit cards use this to figure out the amount of your payment due. Each day, whatever the balance is, they divide it by the number of days in the billing cycle.

The average balance of a savings account or loan, calculated by adding each day's balance and dividing by the number of days in the billing period (usually a month).

A method of computing finance charges in which creditors add your balances for each day in a billing period, and then divide by the number of days in the period

The sum of unpaid principal balance outstanding on all qualifying loans at each actual interest rate for each day of the quarter, divided by the sum of the number of days in the quarter.

The average amount in a deposit account that equals the sum of the daily balances during an accounting period, usually a month, divided by the number of days in the period. The average balance can sometimes be used to avoid service charges or to qualify for special services. See minimum daily balance.

The average daily balance is a method used to calculate finance charges. It is calculated by adding the outstanding balance on each day in the billing period, and dividing that total by the number of days in the billing period. The calculation includes new purchases and payments. For detailed explanation, visit Understand Your Credit Card by Visa

Average Daily Balance is used for calculating interest by most issuers. It is computed by adding up the balance of the account for every day in the billing cycle (usually one month) then dividing by the number of days in that cycle.

The most common method that lenders use to calculate Finance Charges. The Average Daily balance is the amount of your daily balance each day within a period of time defined by the lender that is added together and then divided by the number of days within that period.

This is the method by which most credit cards calculate the payment due. The average daily balance is determined by adding each day's balance and then dividing that total by the number of days in a billing cycle. The average daily balance is then multiplied by a card's monthly periodic rate, which is calculated by dividing the annual percentage rate by 12.

the average amount of money that a customer keeps on deposit over a specific time frame; calculated by adding the daily balances of an account over a given length of time and dividing it by the number of days covered.

The outstanding loan or credit card balance in a given billing cycle divided by the number of days in the cycle.

The average daily balance is calculated by adding each day's outstanding balance (in a billing cycle) and then dividing that total by the number of days in the billing cycle, resulting in the finance charges.

This is the most common method used by credit card issuers for calculating the payment due. The average daily balance is calculated by adding each day's balance (charges minus any credits), and dividing by the number of days in the billing cycle. The average daily balance is then multiplied by the card's monthly periodic rate (the APR divided by 12) to calculate the finance charge for the month.

The average daily balance is a method used to calculate finance charges on an account. It is calculated by adding the outstanding balance on each day in the billing period, and dividing that total by the number of days in the billing period. The calculation includes new purchases and payments. The daily interest rate is then applied to the daily balance to calculate the finance charge.

the credit card account balance that remains when each day's balance is added together and then divided by the total number of days in the billing cycle. This is the account balance you can be charged interest on. It is one of 3 ways to calculate your unpaid account balance.

The average daily balance is calculated by adding each day's balance together and then dividing the sum by the number of days within the cycle for the current month.

A balance computation method for calculating finance charges. It is calculated by adding each day's outstanding balance (in a billing cycle) and then dividing that total by the number of days in the billing cycle.

The most common method of calculating interest. To figure out your average daily balance the bank will add up the amount you owe for each day of your billing cycle and divide that number by the number of days in the billing cycle. New purchases may or may not be added to the balance depending on the individual card's terms. The most favorable calculations exclude new purchases.

A method of computing the figure on which the finance charge for credit card financing will be based. The account balances for each day in the billing period are totaled and divided by the number of days in the period.

Most credit card companies calculate interest charges and the payment due during the billing cycle by this method. This amount is determined by taking the outstanding balance, deducting payments and adding credits for each day in the billing cycle, and then dividing the sum of those amounts by the number of days in the billing cycle. Interest is then charged on the average daily balance amount for the period. New purchases may or may not be added to the balance, depending on the individual card's terms.

Banks measure and compute how much you owe on an average day of your billing cycle and use the average amount to calculate how much interest you owe for the month.

The method used by most credit card companies to calculate your due payment. An average daily balance is determined by adding each day's balance and then dividing that total by the number of days in a billing cycle. The average daily balance is then multiplied by a card's monthly periodic rate, which is calculated by dividing the annual percentage rate by 12.

This allows you to calculate how much your finance charges are. Your account is credited from the day your payment is received by the credit card company. The balance is calculated by totaling the beginning balance for each day in the billing cycle and subtracting any credits made to your account that day. These balances are added for the billing cycle. The 'average daily balance' is determined by dividing the total by the total numbers of days in the month.