Bahrain to Vote on Cutting Credit Card Minimum Payment to 2.5%

Bahraini MPs are set to vote on October 27 on a proposal to reduce the minimum monthly credit card payment from 5% to 2.5%, a proposal submitted by MP Mohammed Al-Maarafi.

The proposal stipulates that the Central Bank of Bahrain require all banks and licensed card issuers to apply the new percentage, and that account statements be sent on the twentieth day of each month, with the grace period continuing until the issuance of the next statement.

Al-Maarafi said that the lower percentage would ease pressure on families struggling to pay their monthly bills, especially those using cards to cover basic needs, noting that the proposal is non-binding even if passed by MPs.

Conversely, the Bahrain Association of Banks warned that a lower monthly payment means larger unpaid balances and accumulating interest, which could prolong debt and increase the burden on customers. It urged leaving the percentage to each bank according to lending rules and assessments of customer repayment capacity, rather than imposing a unified percentage on everyone.

What do these terms mean?

Minimum Payment: The lowest amount a cardholder must pay monthly to avoid default, determined by the bank as a percentage of the total balance due.

Grace Period: The duration during which no interest is charged on purchases if the customer pays the full balance before it expires.

Non-binding Proposal: A recommendation voted on by parliament that does not impose a legal obligation, but rather directs the government or relevant authority to study or implement it.