Post Office Platinum Card

Shoegirladdict

Hi, I've had the situation explained to me twice and have also checked online since calling them. I really don't think the issue is a misunderstanding. The Post Office, or Bank of Ireland, will charge me interest on the full amount run up in any one month until the whole debt is paid. Not interest on the debt remaining, interest on the whole amount including money already paid off every month until every penny is paid off

Gromitt

Yes, that's correct. Pretty much every card works the same way.

For example:
http://www.aquacard.co.uk/credit-cards/reward-card

Interest Charging Information: You will not pay interest on new purchases if you pay your balance in full and on time. Otherwise, the period over which interest is charged is as follows: Charged from Date debited to your account Until Paid in full.

So if you spend £1000, pay of £999.99 and leave a balance of £0.01, you'll be charged monthly interest on £1000 from the date the transaction debited your account.

chattychappy

Sounds like confusion about what "in full" means.

People usually assume that you pay interest on your outstanding CC balance until the balance is paid "in full".

However, interest is actually applied on transactions, not on balances. Applied to this, "in full" could have a different meaning. Ie apply interest on a TRANSACTION until the TRANSACTION is paid in FULL.

Eg:

15th Jan: Single purchase for £1000
1st Feb: Statement showing £1000 balance
15th Feb: Payment of £500
1st Mar: Interest for 6 weeks on £1000 (because transaction not paid in full)

Compare with:
15th Jan: Two purchases of £500
1st Feb: Statement showing £1000 balance
15th Feb: Payment of £500
1st Mar: Interest for 4 weeks on £1000, 2 weeks on £500 (one transaction now paid for in full)

For a typical usage where there are a number of small transactions, the difference might not be noticeable.

I have no idea how common this practice is - it does seem rather unfair. I know Barclaycard used to do it this way. The PO T+Cs at http://www.postoffice.co.uk/finance/credit-cards-loans/credit-card/summary-box seem to allow them to do it this way, though obviously they don't do this for BT transactions.