Every statement from a service provider or lender has negative and positive dollar figures on it. This is true for credit card statements, as well. Deciphering negatives on a credit card statement is a little tricky because credit card companies make adjustments to some basic accounting principles, but having negatives on a credit card statement is a good situation.
The Negative-Positive Flip Flop
Normally, in accounting, any debits or withdrawals are shown as a negative number to show they have been subtracted from a balance, which is shown as a positive number. With a credit card company, this practice is flip-flopped. The credit card company shows charges as a positive number because it is understood that all charges are a withdrawal against your credit limit. They do this because logically it doesn't really make sense to say you owe the credit card a negative dollar amount.
Refunds, Disputes and Voided Transactions
Because of the way credit card companies track your spending, a negative number on your credit card statement sometimes means you were refunded back some of your available credit. This might happen if you buy an item you later return, if you win a dispute over a charge or if you have a vendor cancel the transaction for you.
The amount you owe usually shows as a positive number on your statement, so when you make a payment, the credit card company subtracts the payment from the owed amount. This means the payment appears as a negative. This applies to monthly payments as well as over payments you may make.
People involved with credit card transactions and accounts sometimes make honest mistakes. Even when most of what a credit card company does is automated, problems with hardware and software may result in glitches on your statement. For instance, your company may show you made two payments in a month when you only made one; both would show as negatives. Finding these errors is crucial to determining whether the company is charging you properly, so always check your statements carefully -- many negatives on a statement, although they appear to work in your favor initially, may signal a serious problem with your account.
The Bottom Line
Anything negative on a credit card statement is a credit of some sort to your account. It is not a cause for concern. In fact, having a large negative on your account statement is a good thing, because it means you owe that much less to the credit card company.
- Adventures in Education; Reading a Credit Card Statement; 2011
- Consumer Financial Protection Bureau. "Requirements for Over-the-Limit Transactions." Accessed Jun 18, 2020.
- Experian. "What is a Credit Utilization Rate?" Accessed June 18, 2020.
- Experian. "What Is a Penalty APR?" Accessed June 18, 2020.
- Consumer Financial Protection Bureau. "Why Did My Credit Card Issuer Increase My Late Payment Fee?" Accessed June 18, 2020.
- Consumer Financial Protection Bureau. "Can My Credit Card Company Charge a Fee Based on How I Paid My Bill, Such as for Making a Payment Over the Phone?" Accessed June 18, 2020.
Wanda Thibodeaux is a freelance writer and editor based in Eagan, Minn. She has been published in both print and Web publications and has written on everything from fly fishing to parenting. She currently works through her business website, Takingdictation.com, which functions globally and welcomes new clients.