Interest Question

Late_To_Bed

OK, I'm a bit confused by the interest charges on one of my cards.

If you clear the balance on your payment date, should you be charged interest?

What happens if you used your card the day before your payment date, but the transaction hasn't appeared on your account yet?

Or does it vary from card issuer to card issuer?

Thanks for any help.

Late_To_Bed

For clarity sake:

My payment date is 7th of the month.

My balance was circa £800 and I paid this in full.

However I had used my card on the 6th and this didn't appear on my acct until the 9th.

I have been charged interest when I expected not to.

[Deleted User]

It's probably got something to do with the money being listed as "pending" on the 6th, even though it wasn't actually paid until the 9th.

Sounds a bit naughty, given you can't pay off something, that isn't showing on the statement.

CLAPTON

if you pay your statement in full by the pay by date there is no interest subject to
-you also cleared the previous statement in full
-you did draw cash or near cash

Late_To_Bed

CLAPTON wrote: »

if you pay your statement in full by the pay by date there is no interest subject to
-you also cleared the previous statement in full
-you did draw cash or near cash

It definitely occurred the way I described it.

I didn't draw cash and I did pay the statement in full.

I will phone them to ask for an explanation.

SuperHan

Was it the balance on the actual statement generated that you paid, or the sum of your recent transactions? These can be different and could be why..
If you paid the total balance per the statement by the due date (allowing for bank holidays/weekends/transfer time), you shouldn't have been charged any interest.

MisterMotivated

Did you actually clear your balance in full the month before? The amount you need to pay on/by the payment date is the amount that appeared on your statement for that month. Any spend after the statement is produced will appear on the following month's statement. Therefore your purchase on 6th should have had no impact on your payment around the same time.

For example, one of my cashback cards never has a zero balance, but I don't get charged interest as I always pay the amount requested on the statement.

Considering you're aware of the interest, I assume you've received another statement since then with interest charges? If so, have you used your card for online gambling (I only ask because certain types of transaction get treated as cash advances rather than purchases) or, as Clapton mentioned, to withdraw cash? Cash withdrawals generally have no interest free period and so might explain why this happened.

CLAPTON

Late_To_Bed wrote: »

It definitely occurred the way I described it.

I didn't draw cash and I did pay the statement in full.

I will phone them to ask for an explanation.

you need to pay in full for two consecutive months

redpete

Late_To_Bed wrote: »

It definitely occurred the way I described it.

I didn't draw cash and I did pay the statement in full.

Did you read this bit properly though:

subject to
-you also cleared the previous statement in full

The sequence has to be:

1 - Get statement for month 1;
2 - Pay the amount on the statement in full by the payment date;
3 - Get statement for month 2 which will include some interest;
4 - Pay the amount on the statement in full by the payment date;
5 - Get statement for month 3 which will not include interest;
6 - Spend on CC after statement date but before payment date;
7 - Pay the amount on the statement (i.e. not including spend from step 6) in full by the payment date;
8 - Get statement for month 4 which will not include interest.

MisterMotivated

redpete wrote: »

1 - Get statement for month 1;
2 - Pay the amount on the statement in full by the payment date;
3 - Get statement for month 2 which will include some interest;

None of my cards have ever added interest after paying in full the first month...

redpete

MisterMotivated wrote: »

None of my cards have ever added interest after paying in full the first month...

True - I was using "Month 1" as the first month that full payments after a period when only partial payments are made, not the first month of using the CC.