376% apr &more credit card

idealrob · 12 September 2006 at 7:17PM

Owed £17.00 on cc statement, posted cheque instore 12 days early, m & S money say didnt receive cheque till after due date. I had spent aprox £375 in the next month, even though i still had had 2 weeks to pay for this, they charged me interest of £5.40 on that months statement.
Can the do this ?
if not the interest on the £17.00 is equivalent to 376.47 % which is illegal as i thouught the maximum interest anyone can charge is 60% per anum

idealrob

Celtic · 12 September 2006 at 7:38PM

While I do feel sorry for you I would never pay a credit card by check.
You may have posted the cheque instore but they maybe taken to the bank only once a week .
You would have to send it recorded delivery to be certain.
As the payment is for a seperate "company" there will be no hurry !
The check would then have to clear 3to 5 working days .
If that is over the due by date they can charge you whatever they like providing its written in the small print.
If you had spent anything else and cleared it from the credit card other than the £17 in the month you would pay intrest on it to !

I just set up a direct debit for the minimum payment and pay any more electronicaly .
You can arrange to have the payment arrive on a exact date .
Any problems are the banks fault so you can claim if there were problems.

Cumbrian_Male · 12 September 2006 at 7:39PM

Generally you get interest free credit if you pay your account in full by the statement date AND paid the previous month in full and on time.

So the £5.40 interest will be for the £17.00 on previous statement from transaction date and the £375 on this statement from transaction date until statement production date.

I suggest that you clear this as soon as possible as you are still accrueing interest on both these amounts from this statement's production date until the date the payment is received.

If you go into M&S you can pay your bill at any till, no need to drop it in a box at customer services, and it hits your account quicker.

ti1980 · 12 September 2006 at 9:18PM

If you go to the Customer Services Desk instore, pay your account there. It then only takes a couple of days to hit your account.
If you pay by cash instore though, it comes off your account the next day, even if it is a weekend.

dazed · 12 September 2006 at 11:41PM

Did you pay off a larger balance the month previous ?

If so you could have been hit by residual interest from the larger balance that occurs until the larger balance is paid in full ?

I.E what was your balance from the month before ?

Paul_Herring · 13 September 2006 at 10:16AM

idealrob wrote:

376.47 % which is illegal as i thouught the maximum interest anyone can charge is 60% per anum

Financial instutions can charge whatever APR they want. There is no 'law' requiring them to cap it.

idealrob · 13 September 2006 at 6:56PM

The previous balance was zero, there is a legal limit of 60%. how do m&s charge the equavalent of 376% of 5.40 on £17, thats my main question

idealrob

Gorgeous_George · 13 September 2006 at 7:11PM

You know already that they have not charged you 376% on £17.

The outstanding balance was £375 (+£17?) and the interest is nearer 1.5%.

I would phone them and ask that they refund the £5.40 and offering to close the account if they refuse.

They haven't done anything that is not in the t&c's though.

GG

grumbler · 13 September 2006 at 7:46PM

idealrob wrote:

... there is a legal limit of 60%. ...

No, there is not ... See, for example, Great Champagne 'highest Apr' Credit Card Hunt!.

Also it is always worth reading your card T&C or at least Summary Box:

Interest free period: ... maximum 55 days for Purchases ... when you pay your balance in full and on time every month

This clause is not exclusive for M&S, but is common for all CCs. You have not paid the previous balance on time and hence you lost interest-free period on purchases for both this (previous) and the following months.

idealrob · 13 September 2006 at 8:20PM

for georgeous george i owed £17.00 and the interest for the month is £5.40 which equals 376.47 % fact.

ideal rob

grumbler · 13 September 2006 at 8:35PM

idealrob wrote:

...i owed £17.00 and the interest for the month is £5.40 which equals 376.47 % fact.

And what about £375? Didn't you owe this too? Why do you think that M&S lended this money to you for free?

And if £5.40 was indeed 1-month interest on £17 (that is not true), the corresponding APR would be not 376.47%, but (1+5.4/17)^12-1=26.39=2639%

376% apr &more credit card

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