MBNA Credit Card Interest

bigbadger

Read the T's & C's and confused but also cant believe what my daughter is being told.

I will use an extreme example but the principle is the same.

I make a purchase of £1000 on the 1st day of a statement period. I pay off £999 (they receive cleared funds) on the next to last day of the interest free period (56 days approx). So her payment for the following month would be £1. She has been told that interest is calculated on £1000 until its paid off regardless of the fact she paid £999. Is that correct? She would then pay around £30 for borrowing £1.

I hope some expert will provide me the correct info. BTW the card is MBNA Platinum if that makes a difference.

Thanks

YorkshireBoy

What your daughter has been told is perfectly correct.

When you make a purchase, interest starts to accrue immediately...and daily.

Only if you completely clear the balance by the payment due date do they waive the interest.

bigbloke45

Yup, I'm afraid it's true!

Get her to set up a DD to pay off the balance in full each month and she won't get caught out in the future. It also "sharpens the mind" about how much she spends each month.

Good luck.

methusala_2

Big Badger what you seem to miss is...
1...the balance has NOT been paid in full so the 56days rule doesnt kick in.
2...She has not borrowed 1£ what she borrowed was 999£ for 30days. The following month she will pay interest on the 1£ for 30 days.
Money's paid to account during the month is only allocated against purchases on the statement date.