More VISA and MasterCard issuers are backing away from using the two-cycle method of calculating finance charges. The least understood credit card gotcha has been used by some of the top credit cards in the country including the Discover card and the General Motors MasterCard. Chase announced last week it will switch to the average daily balance method of calculating finance charges on all of its cards. Many card programs established by predecessor First USA employed the two-cycle method of calculating finance charges, which recaptures interest from the previous billing cycle if the current balance due is not paid-in-full by the due date. The controversial method can add up to four months of extra interest charges per year under the worst case scenario for a cardholder. HSBC also recently dropped the two-cycle method of calculating finance charges on its popular General Motors co-branded credit card program, switching to the average daily balance method. Discover, which launched in 1986, pioneered the two-cycle method and continues to use the method on its 50 million cardholders today.