Interest charged when doing 0% balance transfer

TeeMac67

I recently took advantage of 0% for 22 months on a balance tansfer with my credit card (UK). I ALWAYS clear my monthly balance in full and on time to ensure no interest is charged.
My bill showed a balance of £2500 - £2000 of purchases and £500 for the balance transfer - I paid £2000 to clear my purchases - on the following bill I was then charged interest which showed as "purchases".
When I phoned to query this, I was told that this was due to the fact that I did not pay my balance in full and that interest is calculated and charged at the average daily balance of my purchases - I was told that unless I cleared the whole balance (including the 0% balance transfer of £500) then this interest is correct even although I signed up for a 0% on the balance transfer.
Surely, as long as I cleared the purchase balance in full then I should not be charged any interest for the balance transfer.
How can they do this? Is this correct or are the ripping me off?

[Deleted User]

You were charged interest on the purchases, not the BT, which is correct. All cards work this way.

YorkshireBoy

TeeMac67 wrote: »

Surely, as long as I cleared the purchase balance in full then I should not be charged any interest for the balance transfer.

You're not being charged interest on the balance transfer, just the purchases made because you didn't pay the entire bill. This interest should be very small going forwards, unless your card has a £1 minimum interest charge?

How can they do this?

Because it's clearly shown in the T&Cs (if you say which card it is someone will quote you the relevant condition). If you don't 'do' T&Cs, they also tell you in the summary box.

Is this correct

Yes.

are the ripping me off?

No.

It's always best to keep purchases and BTs on separate cards, unless the BT and purchase 0% durations are the same.

TeeMac67

This is a Tesco Card and I though that I would only be charged if I did not clear my purchases in full as my BT was 0%

YorkshireBoy

TeeMac67 wrote: »

This is a Tesco Card and I though that I would only be charged if I did not clear my purchases in full as my BT was 0%

From your summary box...

You will not pay interest on new purchases if you pay your balance in full and on time

http://www.tescobank.com/assets/sections/credit-cards/pdf/tesco-bank-cc-bt-summary-box.pdf

Note the word "balance". They don't differentiate between the various elements, ie purchases, cash advances, balance transfers.

thenudeone

To get purchases interest free, you must pay THE WHOLE STATEMENT BALANCE in full every month. You didn't, you just paid off the purchases.

All cards work this way.

It's usually better not to spend on a 0% BT offer card, if you can.

chattychappy

Look on the bright side. At least your payment was applied first to the purchase balance.

There was a time when they'd have applied it to the promotional balance first!