Barclaycard estimated interest on 0% card

Roland_Sausage

I have one of the 22 month 0% Barclaycards which has the 0% rate on spending and balance transfers until October 2013.

However i note on my last statement, there is estimated interest of £2.56 for next month whereas all the previous statements have £0.00.

Perhaps they won't charge it after all, however it has got me wondering. Is there any type of transactions that they do charge interest on?

The only spending on the card for that month was a transaction for 60 US Dollars. Do they charge interest on foreign currency transactions?

Tixy

Yes probably - most credit cards do charge interest for foreign currency, the same as for cash advances (I don't have a bc card but would expect them to as they are not one of the few that are recommended as not doing). They also charge for gambling transactions which catches people out as well.

The good thing is any payment you make will pay off this part of the balance first, so as long as you pay it off this month then you will only be charged a small amount of interest.

Roland_Sausage

Thanks for confirming this. I was aware of the gambling transaction thing but not the foreign currency charge.

I have made a payment of much more than the value of the transaction so am glad to hear that i will not be stuck with this small amount of interest for the remaining period of the card.

I will avoid making foreign currency transactions in future on this card, and use one that I can clear the balance of every month.

Thanks again.

Fiddlestick

Tixy wrote: »

They also charge for gambling transactions which catches people out as well.

According to a source I have that used to work for a major lender, gambling transactions also !!!! up your internal score with most lenders as it makes you out as a high risk individual when you are gambling with borrowed money.

Tixy

Fiddlestick wrote: »

According to a source I have that used to work for a major lender, gambling transactions also !!!! up your internal score with most lenders as it makes you out as a high risk individual when you are gambling with borrowed money.

You'd like to think they'd distingush between someone who repays their balance in full each month having a small annual flutter on the national, and someone who regularly throws away a monkey in the bookies wouldn't you.

Not sure they would though - that said gambling transactions on a credit card does at least show the holder is not very money savvy otherwise they'd know about the extra cost involved in doing so.

jpwjpw

"Yes probably - most credit cards do charge interest for foreign currency, the same as for cash advances"

This is only if you take money out on your card. Most credit cards will add a fee (around 3%) to the amount if you use the card for a foreign purchase, but interest remains unaffected. I'd suggest the interest is a mistake unless you withdraw the cash, or you used it for a gambling transaction.

Roland_Sausage

jpwjpw wrote: »

"Yes probably - most credit cards do charge interest for foreign currency, the same as for cash advances"

This is only if you take money out on your card. Most credit cards will add a fee (around 3%) to the amount if you use the card for a foreign purchase, but interest remains unaffected. I'd suggest the interest is a mistake unless you withdraw the cash, or you used it for a gambling transaction.

Interesting that you say this. There was a small fee added which was less than £2.

There were definately no cash advances or gambling transactions made. This foreign transaction was the only transaction made the whole month, and in fact I repaid the money to the card 2 days later as well as making my regular payment of well over the minimum payment.

It possibly is a mistake. I will wait until I get the statement and see if they actually charge it or not, as it was just estimated.

Fiddlestick

Tixy wrote: »

You'd like to think they'd distingush between someone who repays their balance in full each month having a small annual flutter on the national, and someone who regularly throws away a monkey in the bookies wouldn't you.

They probably do.

I don't know the full details, but I would imagine that the transactions as weighted so that a bet on the Grand National is probably scored less against the card holder than funding an online power or bingo site.

chattychappy

Roland_Sausage wrote: »

This foreign transaction was the only transaction made the whole month, and in fact I repaid the money to the card 2 days later

It might be that Barclaycard has the rule that payments are applied to statemented transactions before unstatemented transactions. In which case your payment which you thought went towards the foreign transaction actually went towards the existing balance.

Agree with the gist of earlier posts: a transaction in a foreign currency is not treated any differently from a GB£ transaction of the same nature except for the loading on the rate. But drawing cash over the counter, ATM withdrawals, gambling are always treated differently.

Roland_Sausage

chattychappy wrote: »

It might be that Barclaycard has the rule that payments are applied to statemented transactions before unstatemented transactions. In which case your payment which you thought went towards the foreign transaction actually went towards the existing balance.

Agree with the gist of earlier posts: a transaction in a foreign currency is not treated any differently from a GB£ transaction of the same nature except for the loading on the rate. But drawing cash over the counter, ATM withdrawals, gambling are always treated differently.

None of these transaction types have ever been made on the card so still none the wiser.

There is still the possibility it is an error, and I will query it with Barclaycard if and when the interest actually shows on my statement.

Roland_Sausage

I have figured out what happened. The card only had a 3 month 0% promotion on purchases and the 22 months was on balance transfer.

I had assumed that the 22 months was on purchases too and so had put my car insurance on the card a couple of months ago :doh:

Luckily the payments i have been making have been going towards the purchases first, and one more payment should clear the purchases balance, so I shouldn't get charged too much interest.