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A statement credit is a way for credit card issuers to refund your money when you return merchandise or to deliver cash back or other rewards. A statement credit reduces the amount you owe. It typically cannot take the place of the minimum payment due.
If a statement credit is larger than the amount you owe, you can treat it as you would an overpayment, either asking the credit card issuer to return the money to you or leaving the surplus in your credit card account to cover new charges.
What Is a Credit Card Statement Credit?
A credit card statement credit is money credited to your credit card account. It is usually the result of a refund or it is earned as a reward, typically as a sign-up bonus or with a cash back rewards card.
Credit card statement credits reduce the amount you owe without a payment from you.
A statement credit appears as a negative number on your credit card statement. It may be listed under account activity as "payments and other credits." Because it is a negative number, it reduces the amount you owe, just as a payment does.
If you have qualified for a statement credit, it's always smart to double-check that it's reflected in your statement balance, as expected.
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When You May Receive a Statement Credit
There are several scenarios in which you could receive a statement credit, such as:
You Made a Return
Many merchants issue a statement credit on the credit card you used to make the purchase you're returning. The receipt you get for the return will indicate this. Typically, a refund is issued using the same form of payment that was used to make the purchase.
You Redeemed Rewards or Points
If you redeemed cash back rewards and applied them against your balance, you'll see that as a credit on your statement. You may also be able to convert other types of credit card rewards or points into statement credit. If you do that, it will appear on your monthly statement as a credit.
You Made a Qualifying Purchase for a Statement Credit Offer
Using a particular credit card offer to purchase travel, food or streaming services in order to earn a rebate is another way you might see a statement credit. You may see credit card offers that give you an opportunity to earn some cash back for patronizing a certain business or buying a service and keeping it for a certain amount of time.
You Qualified for a Welcome Bonus
Some credit cards offer a welcome bonus to new cardholders who spend a certain amount of money in the first few months they have the new credit card. Once the minimum threshold is met, you receive a bonus in the form of cash back, points or miles. If you have a cash back card, the bonus is typically paid in the form of a statement credit.
The Price Was Adjusted
If the price on something you purchased drops shortly after you buy it, you may be entitled to a refund for the difference if your credit card includes price protection or the merchant offers price-matching. In that case, the price difference will likely be refunded as a statement credit.
You Disputed a Charge on Your Credit Card
You can dispute charges on your credit card for many reasons. Perhaps you didn't make the charge at all, you believe a mechanic charged you for repairs that were not made or an item was not delivered or was not as advertised. If you dispute a charge, you will be given a temporary credit while the dispute is investigated, which could take up to 90 days. If the investigation goes your way, the credit, also known as a chargeback, becomes permanent. If it does not, the charge will be reinstated, and you may owe interest as well.
The Bottom Line
In many ways, a statement credit is similar to a payment—it reduces the amount you owe on your credit card. There are multiple ways to qualify for a statement credit. Rewards credit cards and incentives, such as welcome bonuses and special offers, can result in significant money if you use your credit cards strategically—putting qualifying purchases on the credit cards that offer the best payback.
If you are choosing a credit card with an eye toward an intro bonus or cash back, Experian offers a free comparison tool that can help you find a card that maximizes the features you want and that you are likely to qualify for, given your credit score and credit history.