Can someone help me to understand how this works

teabag29

Ok applied for a vanquis card to repair my poor credit rating. I was asked to set up a direct debit for minimum payment each month which I have done, however I want to pay off the full balance each month as soon as my statement arrives to avoid interest. If I do this and the direct debit also comes out then i'll be paying too much so do I need to cancel the sirect debit or will it automatically show up i've paid in full and therefore the direct debit won't be called for? Sorry it's all new to me and not sure how it works

WestonDave

If you pay in full, normally the direct debit will still be called and you will overpay. You can get around this by deducting the minimum payment amount (say £5) from the total balance on the statement (say £100) and paying the difference at that point (£95) and letting the rest go by Direct Debit.

Or you could ask them to change the direct debit to be the full balance - some providers have this facility not sure if they all do.

(For reference you don't need to pay it in full instantly when you get the statement - you usually get about 3 weeks before the date shown on the statement to pay in order to avoid interest. Its that date that the minimum payment DD will go out. You could set up a bank transfer in advance to go on that date. However I understand why you are a bit nervous and might want to start being absolutely careful, even if its a bit overkill!)

rajinder

I have the same card and I just called the customer service and got them to change it from minimum to full repayment.

Hope this helps.
Raj

lisyloo

Best to get the DD change.
If you try to do manual payments on top it may or may be on top of the DD depending on the timescales and how their computer systems work.
Best bet is to ask them to set up the DD for full repayment.

AdamJK_2

If you have a direct debit setup to pay minimum payment on your credit card and you pay the full balance, or a portion of the balance greater than the minimum payment, a minimum of 4 working days prior to the direct debit collection date (due date on the statement) then no direct debit will be taken - the account and instruction has already been settled. If you pay less than the minimum payment then the direct debit will take only the difference between the minimum payment and what you've paid.

Basically if you receive the statement and pay the bill manually (before 4 working days of the due date) then the direct debit will not be taken.