Halifax Clarity charges almost *twice* the advertised interest rate on cash advances

adindas

I am pretty sure "luci" is very aware about this. She together with Dzug is one of the most active contributors about traveling and travel money in this forum.

I am pretty sure what she meant is the "Credit Cards" for foreign withdraws not Bank a/c. She just did not mention it as here we are talking about a credit Card. are not we.

I add one more on your list "Santander Zero" with Zero debit cards as long as you have a qualifying a/c.

TakeThis wrote: »

Metro Bank, N&P, Cumberland BS......

adindas

Well done you have used the best Credit Card for foreign cash withdrawal. You will not find a better one ....

despistada wrote: »

Summary: The Halifax will charge you multiple times for all cash advances made on their Clarity card.

Yes - they do not charge for cash advances.
Yes - there is a "perfect" exchange rate
Yes - they charge interest until the statement date.

BUT

They charge ADDITIONAL interest from the billing date on cash advances until they collect money via a direct debit - even if the account is paid in full. This will span at least 3 billing cycles.

The Halifax WILL NOT issue your statement AND collect the money on the same day. A minimum of 24 days must pass before they collect the money. ADDITIONAL interest is charged for these 24 days and added to your next statement.

Example (from my own account - interest charged at 17.5%)

• 23 August - Cash Withdrawal £148.78
• 22 Sept - Statement issued. Lists £1.96 interest for cash advance, payment to be collect on 17 Oct.
• 17 Oct - Account Paid in full via direct debit. Card not used again
• 24 Oct - Statement issued. Another £1.65 interest for period between 22/9-17/10 of original cash advance. Payment to be collected 18 Nov
• 18 Nov - Account Pain in full via direct debit. Card not used again.
• 22 Nov - Statement issued. Another £0.02 of interest for the period between 24/10-18/11

In this example the total interest charged £3.36 i.e. 27% annually on a card claiming to be 17.5%

Furthermore, three months AFTER making the cash withdrawal, I'm STILL accruing interest on the cash withdrawal despite paying the account in full via a Direct Debit.

If this is typical of all credit cards, then the advice given on this website is misleading. This is a hidden cost that even the MSE has overlooked.

luci

Perhaps I should have said and easy or mainstream way. I agree that the ones mentioned are fee free, but I think they have conditions attached or are not easily accessible to all, certainly not for me anyway. Isn't the Metro Bank only for those who can easily get to London?

The Clarity card can be used even if you don't have a branch locally.

TakeThis

luci wrote: »

Perhaps I should have said and easy or mainstream way. I agree that the ones mentioned are fee free, but I think they have conditions attached or are not easily accessible to all, certainly not for me anyway. Isn't the Metro Bank only for those who can easily get to London?

The Clarity card can be used even if you don't have a branch locally.

It is worth mentioning that having to cover your withdrawals immediately when using the Clarity card is also a 'condition'.

I would consider it less of a condition to automate five transactions per month through an N&P Light account, than to worry about having to cover a CC ATM withdrawal when I'm out and about.

As for Metro Bank, you only need to vist the M25 area once. You don't need to have a local branch or even live near London.
I would also consider their CC superior to the Clarity Card.

One man's meat is another man's poison, so I would warn against regarding the Clarity as the panacea to all ills.

It's fine for those for which it is fine, but there are better alternatives.

I am lucky enough to have a few of them.

TakeThis

adindas wrote: »

I am pretty sure "luci" is very well aware about this....

I am pretty sure that 'luci' can write for herself.

She asked for a cheaper way of obtaining forex...
It is not only 'experienced' readers who peruse these threads, so we owe it to them to provide them with accurate information.

Now the Clarity together with a Rewards account and a prudent person....

luci

TakeThis wrote: »

Now the Clarity together with a Rewards account and a prudent person....

Yep, got both of those.

I guess I'm looking at it from the perspective of someone who doesn't have easy access to the options you suggested.

A 1400 mile round trip to open a Metro account isn't an option and I really don't need yet another bank account to keep an eye on that I wouldn't use for anything else except Forex. A credit card seems the easiest option, but I agree it's not the only option.

ferf1223

adindas wrote: »

I add one more on your list "Santander Zero" with Zero debit cards as long as you have a qualifying a/c.

Except it's no longer being offered...so if someone doesn't already have a Zero CC, they can't at this point get one.

TakeThis

luci wrote: »

Yep, got both of those.

I guess I'm looking at it from the perspective of someone who doesn't have easy access to the options you suggested.

A 1400 mile round trip to open a Metro account isn't an option and I really don't need yet another bank account to keep an eye on that I wouldn't use for anything else except Forex. A credit card seems the easiest option, but I agree it's not the only option.

Why would someone not have easy access to the N&P, but have easy access to a Clarity card?
The Clarity card is a good option, but it still involves a fair amount of faffing around to get the best out of it. Plus, not every gets the best rate of 12.9%.

I use the Metro DC for cash and my Santander Zero and Nationwide Gold for purchases.

zagfles

despistada wrote: »

I've spoken to Halifax about this option. It's not black and white, and there's a gotcha that can cause the account to be suspended.

Yes you can make a payment at any time, if you clear off the balance, the Halifax will charge no more interest. But you'll have to call, as the website only tells you the last statement balance and nothing about accruing interest.

However, if you use the card again, prior to statement date, they'll start charging interest on the outstanding balance upto the full value of the cash advance.

If you try to avoid this and overpay your account (Pre-loading as it used to be called) to give you an extra buffer. Halifax informed me the system can suspend the card until you money is returned via a check. Although the Halifax rep did say overpaying by just few quid should not cause this problem.

I'd take what you're told over the phone with a pinch of salt.

The website does tell you the full outstanding balance, not just the last statement balance. They are right that you shouldn't overpay and put your account in credit, this violates the T&C's.

The easiest way to use it, assuming you don't go on holiday for more than 2-3 weeks at a time, is to simply:

1) Don't bother with a DD to pay it off
2) Go on holiday, spend and use it for ATM withdrawals.
3) When you get back, check the balance online and pay all it off immediately. If you made an ATM withdrawal just before you got back check this has gone through.

That way you'll only pay 2-3 weeks interest max, on average probably a week or bit more. At 17.5% perhaps about 0.5%

You could mess around trying to pay each withdrawal off while abroad but personally I've got better things to do on holiday than trying to save a few pence interest.

Johnnyy_Boy

Just to add my recent experience. I drew out just over £2000 while on holiday. Paid it off within a week of getting back and Halifax charges
were £6.61. Far cheaper than using my FairFX card.