Tesco credit card charges

gadcam

Let me start by saying, I always pay off my credit card on full, that was, until June.
In May, I paid for a new kitchen using two credit cards. I transferred the money out of my ISA and paid Lloyds in full and on time. However, before leaving to go to France for a weeks motor sport, I couldn't place my Tesco Statement, so I setup a payment for £4400 to leave my account a few days before the due date and then forgot all about it. I knew this was approximately the balance and thought I'd simply sort the balance in July.
I've now received July's statement and have been charged interest. However, the charge is for full purchase price and not just the money outstanding as I under paid by £41.68. Total charges are £94.58. Tesco told me that if I had just paid the extra £41.68, interest would have been zero. This is in their information, but as I always pay on full, it's not something I had realised happened.
Is this normal for all credit cards? Has anyone encountered this before?
As I was being told this by Tesco, I was breaking my card in two. It may be correct, but I do not agree with this policy so I shall not be using Tesco's again.

[Deleted User]

It's common across all credit cards. You pay interest on the money your borrow, unless you clear in full each month.

So you will face the same issue with your next card.

Enterprise_1701C

It's a shame you did that, my Tesco CC is actually quite a good rate of interest compared to many others.

When I can't pay the full balance (extremely rare) I just pay the minimum amount due and pay in full the next month. You pay the same interest and can use this fact to your advantage.

Also, you are obviously online, and you can set up access to the credit card online, so no real excuses for not being able to find out the balance!!

[Deleted User]

Enterprise_1701C wrote: »

When I can't pay the full balance (extremely rare) I just pay the minimum amount due and pay in full the next month. You pay the same interest and can use this fact to your advantage.

You would pay more interest doing that, as interest is charged on a daily basis on your daily balance.

The lower you get your balance, and the more quickly, the less interet you are charged.

InkZ

I'd probably try and be nice to them and see if someone can remove the charges for you as a gesture of goodwill.

If you pay in full every month then you should have a direct debit set up to do this, then this issue can never arise.

gadcam

It's just really annoying.
£94 in interest for a balance, in real terms, of just £41. If I had just paid £4500 instead of £4400.
I realise its is purely my mistake. I just wanted to highlight something I wasn't aware of. If just one person learns from my mistake after reading this thread then I'll be happy.

Gromitt

Deleted_User wrote: »

You would pay more interest doing that, as interest is charged on a daily basis on your daily balance.

I would expect trailing interest on the next months statement as well, for the time between the statement date and the date the payment was made.

gadcam

Interest on top of interest, then more interest on top of that just for good measure! I don't doubt it. I paid the balance off this morning so hopefully it will stop, eventually!

InkZ

If it makes you feel better, you will have earned £11 worth of vouchers, which is £44 down Pizza express so your net loss is only £50 :P

alwaystryyourbest

gadcam wrote: »

It's just really annoying.
£94 in interest for a balance, in real terms, of just £41. If I had just paid £4500 instead of £4400.
I realise its is purely my mistake. I just wanted to highlight something I wasn't aware of. If just one person learns from my mistake after reading this thread then I'll be happy.

Thanks for letting us know this I will be keep a closer eye on my card from now on as I to normally always pay my card off in full..