Interest on barclaycard clarification

maddipops

I have £8500 on my credit card, at 6.9% for the life of the balance. this means I pay approx £50 a month interest, and my minimum payment is £200. so I eat into the debt at £150 a month.

My question is this - If I purchased £150 a month of stuff, would those purchases be paid off first when I make my minimum payment each month>?

I heard the rules have changed where in the highest rate of interest is cleared first.

things will be tight for the next few months so I thought of using this as a way to get more disposable income till july time.

so am I seeing this right? EG I pay £200 minimum payment on 1st april, then I spend £150 on shopping, and on 1st may I pay £200 and that will clear the £150 purchases so I pay no interest on this at the purchase rate>?

seems to good to be true, the CC companies must;ve thought of a way round this?

maddipops

Anyone out there?

cse

Half right. Thanks to the new payment allocation rules, your payment should clear the £150 purchase, BUT you will be charged interest on that £150 from the day you made the purchase transaction to the day it is paid off.

It's not a matter of the credit card companies having thought of a way around it - this method of charging interest is how credit cards have always worked. Still, the payment allocation rules mean the situation is better for you than it used to be, when you'd be stuck paying purchase rate interest forever!