Credit card cash advance: Should I make payment straight away?

pb3

Hi All,

I withdrew £100 as a cash advance on one of my credit cards (Barclaycard) when I was out and about earlier today. I had forgotten my bank card and I needed the cash.

Now I believe that interest is assessed on cash advances straight away from the moment they are made, and more than likely a cash advance fee applies.

My query - Will it reduce the interest to be paid if I make a payment to the credit card straight away to clear the £100 + cash advance fee (no other transactions are on the card) rather than waiting for the next statement to be issued? Not sure how these things work.

If there will be no reduction in the interest charged or it will be fractions of one pence, then I may as well keep the money in my current account until the statement is issued

I'm fully aware I owe the cc company some money for the convenience of having access to the cash straight away. No problem there - I just want to minimize the total charge

jackieblack

pb3 wrote: »

Hi All,

I withdrew £100 as a cash advance on one of my credit cards (Barclaycard) when I was out and about earlier today. I had forgotten my bank card and I needed the cash.

Now I believe that interest is assessed on cash advances straight away from the moment they are made, and more than likely a cash advance fee applies.

My query - Will it reduce the interest to be paid if I make a payment to the credit card straight away to clear the £100 + cash advance fee (no other transactions are on the card) rather than waiting for the next statement to be issued? Not sure how these things work.

If there wil be no reduction in the interest charge or it will be fractions of one pence, then I may as well keep the money in my current account until the statement is issued

I'm fully aware I owe the cc company some money for the convenience of having access to the cash straight away. No problem there - just wan't to minimize the total charge

Yes, it will, as interest will be calculated on a daily basis until the full amount is repaid. The fewer the days, the less the interest

CLAPTON

if e.g. interest rate was 24% APR (no idea what yours is)
then on 100 cash advance interest would be approximately

100 * 24/365 pence per day i.e. 7 pence per day

your fee may well be £2.90 but it too late now

chattychappy

Yes, on the facts you state it would be. However nothing can be done about the fee and the interest is unlikely to be punitive on £100 (something of the order 7p/day), so no great panic.

If you were carrying a balance, then better to pay this off at the same time to be sure that payment is allocated to the cash advance.

pb3

Thanks to everyone who replied.

I will follow the advice given and pay off the advance and fee immediately.

Nebulous2

You might not be able to until the transaction is showing in your account. I tried to pay my barclaycard off on Friday, using the current and pending transactions figure and it wouldn't let me. It said I wasn't allowed to put my account into credit and gave me a slightly lower figure as the maximum.

I've very occasionally withdrawn cash when I need it from a credit card and have never really grudged it. We are pretty careful with money but occasionally can do an impulse buy. For me that's one of the reasons to have a credit card.

pb3

Nebulous2 wrote: »

You might not be able to until the transaction is showing in your account. I tried to pay my barclaycard off on Friday, using the current and pending transactions figure and it wouldn't let me. It said I wasn't allowed to put my account into credit and gave me a slightly lower figure as the maximum.

You are spot on! I noticed that when I went into my account to pay. I seem to remember Barclaycard brought this in as a counter measure against stoozing.

I'll check again on Monday to see whether the transaction has posted.