Keeping a Credit Card in Credit?

moggins

Due to my bank changing their debit card to a Visa Electron I will no longer be able to shop with Tesco online.

I was going to open a new account with Natwest just to put my shopping allowance into but I've spoken to the Halifax this morning and the very understanding girl I spoke to has assured me that very soon the majority of banks will be going in the same direction and to hold fire until I know whether Nat West are doing the same.

But I need a card to do my shopping so I'm going to use my Barclaycard but I don't want to leave my shopping allowance in the bank as the other half is not as careful with money as I am.

Can I put money on my Barclaycard in advance and then spend it? So basically my card will always be in credit? I won't be losing any interest as my bank account doesn't pay any. And I can check my barclaycard balance online just the same as my internet banking.

Please help, I'm a relative newbie when it comes to credit cards, this is the first one I've ever had and due to a bad credit history probably the only one I will ever have. Frankly I was gobsmacked that they even gave me one

lisyloo

It depends on the card company but in some cases your money won't be insured.

This means that if you card gets stolen whilst in credit then your money will not be recovered.
Some credit card companies only cover THEIR losses and not YOURS.

To find out for sure you would need to call the company directly because this varies across companies.
Personally I wouldn't put my card in credit if the money was not insured against theft.

JasonW_2

I think a better way would be to set up a direct debit that clears off the whole balance on the barclaybardevery month, so you use the card, and not have to worry about being charged interest. You will have to ask for this though, as most direct debits just take the minimum as standard. You can still keep and eye on things online and make sure its being paid.

Dont listen to the girl in halifax talking about natwest though, you would be better asking natwest directly, and explain the situation to them. You could possibly change your bank account with halifax though could you not? Im with bank of scotland and had my switch card replaced by a visa, not electron though, so unless there are any reasons you know of that you have this card, I would again explain to them an electron card is no good.

JW

moggins

Unfortunately due to a divorce and getting into a mess with a Halifax account and loan they won't upgrade my account at all, so I am stuck with a basic account.

I'll definitely go back to the Nat West and ask them if they are going to be changing at any point, thanks for that.

And I'll definitely ring Barclaycard and ask what their policy is too.

grumbler

There is nothing wrong in keeping your credit card always in credit.
However, is not it better to keep this money in some other interest bearing current or easy-access saving account and pay credit card balance in full by Direct Debit, for example? In this case you can have more flexibility, more than 1-month interest-free period on purchases and some interest on your money as result.
You can also use Liverpool Victoria credit card that pays decent interest on credit balances.

rchddap1

How about setting up another account for your credit card. Every month as soon as the cash goes into your main account a certain amount gets transferred to this other cc account. you then setup your credit card to take money from the new cc account. That way the money isn't lingering in your main account for either yourself or your partner to spend.

Hope this makes sense.

moggins

Thanks everyone, there are some great ideas here. Sorry I sound like a twit but after being in such a financial pickle 5 years ago it's only been discovering this site that has stopped me being grateful for them just giving me a basic bank account.

lisyloo

"There is nothing wrong in keeping your credit card always in credit."

I don't agree with this statement for the reasons already stated (unless you have specific knowledge about this provider).

Money in credit may not be insured.
I believe it is with Liverpool Victoria but not with Nationwide
I don't know about Barclaycard.

moggins

I've just applied online to Nat West for a basic account, so I'm going to see what happens there, if not then I'll have to ring Barclaycard and see what the situation is.

I can't give up my online shopping, it would cost me a fortune if I have to take the kids shopping with me

zcaprd7

If you are going to spend on a credit card and pay it back in full each month you might as well look at getting a cashback card - they've started to get a bit stingey recently but you should be able to get at least 0.5%...

katmar_2

moggins wrote:

Due to my bank changing their debit card to a Visa Electron I will no longer be able to shop with Tesco online

I was going to open a new account with Natwest just to put my shopping allowance into .

I have one of these and you just set up a Monthly D/D for your Tesco (only) shopping needs and the credit is held on the card to be used in the same way as a CC. You also get double points with everything you buy on the card and if you are in balance you take cashback at the till on it. Interest (not much) is paid on credit balances and you can set an agreement to overdraw by one month's payment if required (interst payable)

I do not shop online, but I assume you could use it for online purchases.

Cheers Kath