what is the average daily balance method 
the average daily balance method is a common way that credit card issuers calculate the interest charges cardholders have to pay it is based on the card s outstanding balances on each day of the billing period understanding the average daily balance methodthe federal truth in lending act tila requires credit card issuers to disclose their method of calculating finance charges as well as the annual percentage rate apr fees and other terms on the card in their terms and conditions statement providing these details makes it easier for consumers to compare different credit cards to calculate their finance charges card issuers can use any of several different methods among them are if you pay your credit card balance in full each month you won t have to pay interest 