The great interest ripoff

fezzalad

I have a Morgan Stanley card and my last balance was £1055. A friend owed me £1050 pounds so I sent their cheque to pay off my card. I have just received my next statement showing £20 interest. When I enquired why I was told that if I don't pay off in full I get charged on the full amount so I have been charged interest on money I paid them!!!

Does anyone know of a credit card that does not calculate interest in this way???

Rafter

I think most cards use this 'trick'. It is the only way they can afford to offer 0% interest deals for new customers and interest free periods for customers who pay in full.

Some are better than others though, only charging interest up to the date you make your payment, not the next statement date.

Suggest you try the Nationwide Credit Card. As a mutual building society their interest charging will probably be less sneaky than most, and you get the benefit of saving 2.75% on any transactions overseas. Otherwise just set up a direct debit for the full amount on any credit card and have a cheaper overdraft facility in place to cover any spend above your current account balance.

R.

Paul_Herring

fezzalad wrote:

Does anyone know of a credit card that does not calculate interest in this way???

All cards work this way. You either pay the whole lot off, and pay no interest, or pay some of it off but pay interest on the whole amount.

tom188

How unreasonable for a credit card company to charge you interest on money you have borrowed from it.

MrChips

You're thinking about it all wrong!

You aren't paying for these items straight away, the credit card company is paying for them and temporarily lending you the money to do so. They charge you interest as agreed (eg 18% pa) from the date of the purchase (money lent) but waive this interest if you pay off the WHOLE balalance by an agreed date. If you only pay off some of it, they charge you interest from the date you made the purchase as (I guess) you agreed to when you took out the card.