The smallest payment is designed to keep you current — not to free you
Common formulas: a small percentage of the balance, or interest plus 1% of the balance — often with a flat floor, such as $25.
Hypothetical example at 18% APR: interest + 1% gives a $125 minimum. A flat 2% formula gives $100. Your card agreement decides which.
In that example, 12 months of minimum-only payments cut the $5,000 balance by only about $568 — it still sits near $4,432.
Keep paying only the shrinking minimum and payoff takes roughly 18.5 years — with interest of about $6,539, more than you originally owed.
Hold the first $125 payment fixed and the same debt clears in about 62 months with about $2,693 interest. A fixed $200: about 32 months, about $1,314.