Cash Interest on Credit Cards

mpdpward

I have a SkyCard credit card, which I use in order to get money off my Sky digital bill. However, I managed to find myself where I needed cash but only had my Skycard with me. I drew money out, accepting the handling fee. I wasn't concerned about additional interest as I pay the balance off in full each month.

When I checked my statement online (the method I use to pay the balance off in full) I noticed I was being charged cash interest! When I phoned and asked, I was told that this is because cash interest is calculated daily and then added to the balance at the end of the month, when the statement is sent out. I told them this was rather underhand but they informed me this is in the terms and conditions and that many other credit card companies have the same T&C's.

Is there anything I can do? The website indicates that I am paying off the full balance, but, in reality, I am not.

Any thoughts?

King_Of_Fools

Unfortunately, all credit cards are exactly the same!

Gordon_the_Moron

They charge interest on cash withdrawals immediately, not after your statement, so even if you pay in full at the end of the month you will be charged. You also pay a higher APR on the cash and you pay a handling fee.

Apart from Nationwide (I don't think any others do it) they apply payments in a negative order so the balance attracting the highest rate of interest (the cash) is paid off last so until you clear the whole balance this interest earning balance is trapped.

Nothing you can do this time but remember in future, don't get caught out NEVER EVER EVER withdraw cash on a credit card.

Mercuryrising

HSBC credit card are the best for withdrawing cash as it treats it like a purchase and you have 59 days to pay it off before it attracts interest.

Although I use the word 'best' loosely as they still charge a 2% cash withdrawal fee. :mad:

CIMA_LOVER

How can i calculate the cash interest at 27.9% for £150??

jojo1978_3

Just call and ask for a settlement figure, or pay a little more than the full amount, at least then you'll be back to a zero balance and clear for the following months

And the interest should only be about £3.35,(thats an estimate) my maths isn't great

Gordon_the_Moron

Mercuryrising wrote:

HSBC credit card are the best for withdrawing cash as it treats it like a purchase and you have 59 days to pay it off before it attracts interest.

Although I use the word 'best' loosely as they still charge a 2% cash withdrawal fee. :mad:

Still avoid withdrawing cash, after the 56 days (according to hsbc.co.uk it is 56 not 59) after this the interest rate for the cash advance is over 20% and they aren't included in the 0% introductory offer. They apply payments to the balance attracting the lowest rate of interest first and the highest last. Nationwide do it the opposite way round, so unless you are going to pay the whole balance off at the end of the month I'd say you were better drawing cash on a Nationwide card.

Either way you'd be better off overdrawing a debit card and paying it off the next month (especially if you use A&L or Nationwide or someone with a reasonably low rate) but even an overdraft with the likes of Barclays or Natwest would beat a credit card withdrawal.

AS I SAID BEFORE NEVER EVER EVER WITHDRAW CASH WITH A CREDIT CARD.

eltrot1979

Am i correct in thinking that the Egg Money card does not charge a fee for withdrawing cash? How about abroad? Of course there will be a foreign currency fee, but i don't think there is a standard charge for using a cash machine. Can anyone confirm this?

Does this make it as good as a Nationwide Credit Card? I don't really want to open another bank account so the Nationwide Debit Card is not really an option I want to consider.

thanks

Paul_Herring

eltrot1979 wrote:

Of course there will be a foreign currency fee,
[...]
Does this make it as good as a Nationwide Credit Card?

No. Egg will be adding on their 2.75% (or however much it is) currency fee. Nationwide don't.

Edit - Egg charge 2.65% - see http://new.egg.com/visitor/0,,3_61028--View_1150,00.html

kuohu

eltrot1979 wrote:

Am i correct in thinking that the Egg Money card does not charge a fee for withdrawing cash?

Egg Money does not charge either a fee or interest for a cash withdrawal whilst you are in positive balance, so long as the withdrawal itself does not take you into negative balance.