How to Calculate Interest for Credit card cash withdrawal?

ibexward

Hi,
Can anyone explain to me how to calculate the interest payable (approximately) on a cash withdrawal on a credit card? I'm trying to figure out whether it is actually cheaper to withdraw cash using a Halifax Clarity card or my First Direct debit card?
Thanks

opinions4u

Amount withdrawn x APR* / number of days balance exists for.

(*APR isn't the exact rate charged, but for the purposes of example it will be close enough).

e.g.

£100 x 12.9% = £12.90 / 365 = 3.5p per day or £1.06 a month.

Pay it off quick and you'll pay virtually no interest.

For other credit cards you'd need to factor in any cash handling fee or minimum charge.

zagfles

There is no way it will be cheaper on the FD debit card, unless you leave the debt on the Clarity for ages, ie several months (you obviously don't need credit as you're considering using a debit card).

For a short holiday (2-3 weeks) the interest will be trivial if you pay the Clarity off as soon as you get back (don't wait for the statement - check the balance online and pay it all off). You'll probably pay less than 1% interest compared to probably nearly 5% in charges on the FD card.