Interest on 0% interest balance transfer!

Kirkby

I have a 0% balance transfer with Barclaycard (£700) and I use the card each month (another £2-300). My most recent statement shows a £3 interest charge despite having paid off the full amount minus the £700 0% balance. I paid the amount more than 10 days before the due date. I called and was told that because I hadn't paid off the full balance the interest had been charged. Is this standard practice? As I have paid off my monthly purchases in full, this seems to be interest on my 0% balance transfer.

CLAPTON

indeed so
the purchases are interest free only if the entire balance is cleared each month

hence the normal wisdon is not to mix 0% BTs and purchases; use two different cards

chattychappy

Yep and it is pretty standard. It was worse in the old days when payments would be first applied to the BT, so your purchase amounts would be "grandfathered" attracting interest until the entire BT had been paid off.

As CLAPTON says, it is usually better to put purchases onto another card and pay them off in full each month.

If you are paying interest on other cards, it can in some circumstances be worth putting purchases onto the BT card and paying the interest just as you have done. Because the payment is applied to the purchases first, you are effectively protracting your BT balance freeing up cashflow to be applied to higher interest balances.