Vanquis Interest

loony2012

Can anyone work out how they came to this interest conclusion?

Balance carried forward £0.00
Credits to your account £0.00
Debits to your account £235.17
Statement balance £235.17
WHAT AND WHEN TO PAY
Minimum payment† £10.58
Payment due date 15 Mar 12
Estimated interest** £18.13


£18.13p? Is that Per year or each month? As per monthly it's surely not right. Cap One interest i have is almost the same and that is pennies per month.

YorkshireBoy

Can anyone work out how they came to this interest conclusion?

Not with the limited information you've provided. For example:

What date(s) did you make the purchase(s)?
What's your statement date?
What's your APR?

But in short, it's the monthly interest that will be charged to the account at your next statement date if you make only the minimum payment (of £10.58) on the due date and make no further purchases between that statement and the next statement. All this should be explained on your statement.

SnowTiger

loony2012 wrote: »

Can anyone work out how they came to this interest conclusion?

Balance carried forward £0.00
Credits to your account £0.00
Debits to your account £235.17
Statement balance £235.17
WHAT AND WHEN TO PAY
Minimum payment† £10.58
Payment due date 15 Mar 12
Estimated interest** £18.13


£18.13p? Is that Per year or each month? As per monthly it's surely not right. Cap One interest i have is almost the same and that is pennies per month.

You forgot this: "** Estimated interest is the amount you will pay next month if you don't pay off your current balance in full."

I don't receive paper statements from Vanquis. Presumably this is what's on the back of them:

Interest
Remember the best way to pay less interest is to pay off your monthly balance in full, or at least as much of the outstanding balance as you can. The estimated interest is
only a guide and is based on the Minimum Payment reaching us by the Payment Due Date. It is for guidance only and will vary, depending on when your payment reached us,
your payment amount, and whether you use your card before the next Statement Date. If you pay off the balance in full by the Payment Due Date on two statements in a row,
you won’t be charged interest on any purchase transactions on the second statement.

£18.13 is the estimated interest that will appear on next month's statement if you don't clear your balance and make any further purchases.

But to know if the amount is correct we need to know your APR and when the purchases were made: don't forget that you pay APR on all purchases from when they were made if you don't pay your statement in full.

Let's assume a worse case scenario: your APR is Vanquis' highest at 69.94%, you made all those purchase on the day after your last statement was produced (or the account was opened) and you don't pay this statement in full. By the time your next statement is produced you will have to pay 60 days interest on those purchases.

So, that's approximately £235.17 * .6994 (APR) / 365 (days) * 60 (days) = £27.03, so it could be worse. Not paying a credit card balance off in full (unless you're on a 0% deal) is a mugs game.

loony2012

Next statement date 19 Mar 12

Purchases were on 20 Jan 12

and APR was 39.9%

SnowTiger

loony2012 wrote: »

Next statement date 19 Mar 12

Purchases were on 20 Jan 12

and APR was 39.9%

You have to pay back 4.5% of the balance on the card each month, plus interest and extras.

According to What's The Cost the interest on your next statement should be £14.88 (£7.61 (interest for Jan/Feb) + £7.27 (Interest for Feb/Mar)), assuming the card isn't used again during the period.

So, £18.13 does seems little high. However it is only an estimate.

Tremour-88

are you sure you're on 39.9% APR? thats just what they advertise as there rate, it can range from 29.99% to 79.99%

loony2012

yep on the phone i was told 39.9

letter says your monthly purchase interest is 3.990%

3.99000 x 12 = 47.88% so looks as though they lied to me.

Do they record calls so i can ask staff to review it?

Tremour-88

loony2012 wrote: »

yep on the phone i was told 39.9

letter says your monthly purchase interest is 3.990%

3.99000 x 12 = 47.88% so looks as though they lied to me.

Do they record calls so i can ask staff to review it?

The person on the phone probably told you their average rate is 39.99%, they round interest down slightly so it looks as if your on 49.99% APR.

Also NO member of staff can change your interest rate or increase your credit-limit, only the system reviews do this.

YorkshireBoy

Tremour-88 wrote: »

they round interest down slightly so it looks as if your on 49.99% APR.

You're forgetting the effects of compounding. 3.99% monthly equates to 59.9% APR when compounded.

OP,

20/1 to 19/2 = 31 days
20/2 to 14/3 = 24 days
15/3 to 19/3 = 5 days

£235.17 x 47.99% / 365 x (31+24) = £17.00
(£235.17 - £10.58) x 47.99% / 365 x 5 = £1.48

£17.00 + £1.48 = £18.48

The small discrepancy (of 35p) is probably due to me assuming an incorrect Feb statement date of the 19th because you didn't confirm when I asked earlier. Or maybe it's because they use daily compounding and 365th roots?...but I'm no mathematician so can't help with that.

loony2012

YorkshireBoy wrote: »

You're forgetting the effects of compounding. 3.99% monthly equates to 59.9% APR when compounded.

OP,

20/1 to 19/2 = 31 days
20/2 to 14/3 = 24 days
15/3 to 19/3 = 5 days

£235.17 x 47.99% / 365 x (31+24) = £17.00
(£235.17 - £10.58) x 47.99% / 365 x 5 = £1.48

£17.00 + £1.48 = £18.48

The small discrepancy (of 35p) is probably due to me assuming an incorrect Feb statement date of the 19th because you didn't confirm when I asked earlier. Or maybe it's because they use daily compounding and 365th roots?...but I'm no mathematician so can't help with that.

There is 366 days to this year. This is a Leap year in Feb.

And as for average no i was told the credit limit and APR WAS. Not Average it was you ARE Getting this.

Tremour-88

You may have been told that you were getting 39.99% APR but it turns out you didn't as worked out above.

No point complaining they will not and can't adjust it.