JohnnyGreig / E+ / Getty Images

Account management

What is an outstanding balance on a credit card?

Outstanding balance is the total unpaid amount on your credit card. Read on to learn how it differs from other balances, and how much you should pay


Outstanding balance, also known as current balance, refers to the total unpaid amount on your credit card. This includes purchases, balance transfers, cash advance, interest charges and fees. Here’s how it differs from other balances on your credit card statement.

The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs. Terms apply to the offers listed on this page.

Understanding your credit card statement can be a bit of a balancing act.

That’s because the statement lists more than one balance. This might include what’s known as an outstanding balance.

So, what is an outstanding balance and how does it differ from other balances that pop up on your credit card statement? Follow along to supercharge your knowledge of credit card balances.

What is an outstanding balance on a credit card?

An outstanding balance, also known as current balance, refers to the total unpaid amount on your credit card. This includes purchases, balance transfers, cash advance, interest charges and fees. The outstanding balance serves as a real-time snapshot of your credit card account.

The outstanding balance changes every time you use your credit card, even from one minute to the next. For instance, if you charge a $75 dinner to your credit card, this $75 purchase will become part of the outstanding balance once the transaction posts to your account.

The outstanding balance helps determine how much credit you have available at a given time. To come up with your available credit, subtract the outstanding balance from your credit limit and add any outstanding charges that haven’t shown up yet in your account.

So, let’s say your outstanding balance is $1,500 and your credit limit is $5,000, and there’s a pending transaction of $200 that hasn’t appeared on your account yet. At that moment, your available credit is $3,300 ($5,000 subtracted by $1,500 and $200 = $3,300).

Where do you find your account’s outstanding balance? You can find this information by logging into your account online or through a mobile app, or by contacting the company that issued the credit card (like American Express, Capital One, Chase or Citibank).

How does outstanding balance differ from current balance?

Even though the names are different, outstanding balance and current balance mean the same thing.

How does outstanding balance differ from statement balance?

Statement balance refers to the amount of money you owe based on the last statement, or bill , that you received. It also might be shown as monthly balance or new balance. This dollar amount may or may not be the same as the outstanding balance.

The statement balance reflects all of the purchases, interest charges, fees and other items that accrued during the most recent monthly billing cycle.

The billing cycle is a specific time period between billing statements. So, one billing cycle might run from May 9 (the opening date) to June 8 (the closing date). The bill cycle doesn’t necessarily go from the first day to the last day of each month.

Keep in mind that the statement balance remains the same until the credit card issuer sends the next monthly statement. However, the statement balance and outstanding balance may or may not match.

This depends on whether there’s been any activity on your card since the statement balance was computed. If there has been activity between monthly statements, the statement balance and outstanding balance might be different. If there has not been any activity between monthly statements, the statement balance and outstanding balance might be identical.

How much of your outstanding balance should you pay?

You’re staring at your credit card bill and wondering how much of your outstanding balance to pay. The decision depends on your financial situation at the time.

The statement balance often exceeds the minimum amount due that appears on a monthly statement. Let’s say the statement balance is $2,000, but the minimum payment due is $50. At the very least, you should make the minimum $50 payment by the due date.

But if you want to avoid paying interest, you should pay the entire $2,000 statement balance. Paying the full statement balance is a smart way to escape interest charges.

You don’t have to pay the outstanding balance to steer clear of interest and fees. Paying the statement balance will take care of that.

But if you pay the entire outstanding balance, you can lower your credit utilization ratio. This ratio refers to the amount of money you owe on all of your credit cards divided by the total of the credit card limits on your cards.

Here’s an example of how the credit utilization ratio works. You owe a total of $2,500 on your three credit cards. The total credit limit for all three cards is $10,000. This means you’re using 25% of your available credit, giving you a credit utilization ratio of 25%.

Why is the credit utilization ratio important? It typically represents 30% of your credit score. Some experts recommend keeping your credit utilization ratio below 30%. But others suggest lower amounts, like 25% or even 10%. Use our credit utilization calculator to see where you stand.

How does your credit card balance affect your credit score?

Consistently making on-time credit card payments can help your credit score. But even if you’re making on-time payments, carrying big credit card balances might hurt your credit score.

As we mentioned, your credit card balances can affect your credit score based on your credit utilization ratio – the overall amount you owe on your cards versus the overall credit limit.

A high credit utilization ratio can drag down your credit score. If a credit card issuer sees that you carry high balances on your credit cards compared with your credit limits, it might view you as a risky customer.

Why? Because high balances might signal that you’re experiencing financial problems and, therefore, might make late payments or skip payments altogether.

Your payment history makes up 35% of your credit score. Making late payments or missing payments can harm your payment history and bring down your credit score.

Bottom line

High balances on your credit cards can eat away at both your credit utilization ratio and your payment history. This, in turn, might make it harder to qualify for credit or could stick you with higher interest rates if you are able to obtain new credit. With this in mind, it is always a good rule of thumb to pay your balance in full at the end of each billing cycle to avoid these types of consequences.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

What’s up next?

In Account management

What if your credit card statements were made public?

Your credit card statements show more than just how much you spent this month. They reveal your personality, financial health, lifestyle and possibly dirty secrets. Here’s how to use those statements as a self-diagnostic tool.

See more stories
Credit Card Rate Report
Cash Back

Questions or comments?

Contact us

Editorial corrections policies

Learn more