With the deregulation of the banks in Australia some years ago , some lenders turned the standard 25 year term home loan on its head by educating borrowers how to pay off their home mortgage faster by having all their pay paid directly into a line of credit account.
Mortgage interest is calculated on the daily balance and so any extra money parked in your line of credit loan account would in fact reduce your mortgage interest.
 Once the word was out about this method, all the other major banks and lenders had to offer this service to keep their customers. Some might ask "Why didn't the banks tell us about this scheme earlier?"
A line of credit loan [account] will allow you to pay just the interest only [minimum monthly repayment] or choose to pay as much as you like. Any more you pay will come off the principle loan balance, therefore reducing your interest.
A credit card acts very similarly. You can elect to pay the minimum amount each month
which is about 2 or 3% of the balance or you can pay more which reduces the principle, therefore reducing your interest payable.
As credit cards also calculate their interest daily with various interest rates from 10 to 20% plus various fees for late payments and annual fees, we can look at treating the credit card like a line of credit.
Introducing the "Schredit Card"
Traditonally we are educated to pay off our credit card at the end of the month when it is due.
If we reverse this and pay our income into our credit card we will in fact reduce our balance by that amount immediately, hence alleviating up to 20% interest calculated daily. Why have our pay sit in low interest savings accounts getting around 2% in interest when we can SAVE up to 20% by putting it on our card.
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