What is a late fee associated with credit card payments?

A late fee associated with credit card payments is a charge imposed by the credit card issuer when the cardholder fails to make the minimum payment by the specified due date. This fee serves as a financial penalty for not adhering to the agreed-upon payment schedule. It acts not only as a deterrent to late payments but also helps the issuer mitigate the risk associated with lending. Late fees can vary based on the card issuer and the specifics of the card agreement, and they can contribute to the overall cost of borrowing on a credit card.

The other options do not accurately describe a late fee. Timely payments are rewarded in many cases through benefits like lower interest rates or cashback, but they are not associated with a fee. Exceeding a credit limit can result in an over-the-limit fee, distinctly different from a late fee. Account maintenance fees are typically charged for maintaining the account and managing its costs, unrelated to payment timing.