Ok
First thing to remember is that interest is calculated DAILY, then charged periodically (usually monthly)
Say you have a mortgage of $100k, get paid $5k a month (net) as ~$1150 per week.
Your pay goes into your offset account (normal bank account) and just sits there as you are using your credit card for everything.
While the money is in the offset account your interest is calculated on the loan balance minus the offset balance each day. So if you have $5k in there your interest is charged on $95k despite the borrowings of $100k.
The credit card is interest free for 30 days which allows you to have more days with the balance sitting in your transactional account offsetting the mortgage balance.