Payment allocation - Barclaycard - statement first?

BeattheBank_2

I recently transfered a balance to my Barclaycard and then made the mistake of using it for purchases. The next statement showed that they would be charging me interest on the purchases as, with a transfered balance on there, the statement total would not be paid off.

Ok, my mistake, and with several other purchases there I decided to reduce the future interest by paying off in advance purchases I had made, which appeared online, but which I had not yet received a statement for.

Checking online I managed to make a payment to cover all the purchases, leaving the transfered balance.

The next statement arrived and showed that there would be interest due next month and that the purchases which I had thought I had paid off in advance were still there. The payments I had made had paid off the balance of the first statement, and effectively halved the amount of the balance transfer I had made only 4 weeks previously for a 12 month period!

The new purchases were attracting interest daily.

As I understand it, and as the nice lady on the Barclaycard phone confirmed, payments are allocated to purchases first and then to balance transfers. Barclaycard, it would seem, are paying off your statement first and ignoring purchases made but which have yet to appear.

Is this legal?

I made a complaint to the lady on the phone and also wrote to head office who have just confirmed receipt and I await their findings. (Which I will add to this post)

[Deleted User]

It's very legal. And a very common way of allocating payments.

Statemented first, then high to low rates within that. Then unstatemented and high to low within that.

BeattheBank_2

Maybe legal was the wrong word. Is this consistent will legislation/banking code?

When asked, I was told that payments were allocated to purchases first and then transfers. (Which is what Joe Public now understands). I had to ask if it only applied to the current statement and when I queried it a supervisor was asked. I was also told that my comments would be forwarded.

When you also take into consideration that online access shows a daily update of your account along with the pressure to cancel paper statements, there is potential here for confusion and additional interest opportunities.

In a way, paper statements are more convenient and simpler!

[Deleted User]

Yes, it's also consistent with legislation.