minimum payment vs interest.

sheba

Morning all,
Just popped on here as had a query re credit cards and minimum payment levels vs interest. This is merely a query, as I settle my bill in full each month on my Barclaycard cashback account so pay no interest at all, but I noticed on my most recent bill of £798.05 the minimum payment is £15.96 whilst the estimated interest is £15.87, meaning if I were having to pay the minimum amount my overall bill would reduce by 9p!!
My query is: I thought legislation(?) had been brought in to make cc lenders ask for a % of balance as a minimum so that any payment made makes real ingress into the 'debt', even with interest added. Do you think the amount I have quoted (minimum payment particularly) has been reduced by credits made to my account by way of refunds in the past month? I just can't believe that any financial institution would be allowed to let a customer only pay off 9p (after interest) on a debt of nearly £800- as that would take a wee while to clear in that way- too long for me to even be bothered to work out!!
TIA

CLAPTON

sheba wrote: »

Morning all,
Just popped on here as had a query re credit cards and minimum payment levels vs interest. This is merely a query, as I settle my bill in full each month on my Barclaycard cashback account so pay no interest at all, but I noticed on my most recent bill of £798.05 the minimum payment is £15.96 whilst the estimated interest is £15.87, meaning if I were having to pay the minimum amount my overall bill would reduce by 9p!!
My query is: I thought legislation(?) had been brought in to make cc lenders ask for a % of balance as a minimum so that any payment made makes real ingress into the 'debt', even with interest added. Do you think the amount I have quoted (minimum payment particularly) has been reduced by credits made to my account by way of refunds in the past month? I just can't believe that any financial institution would be allowed to let a customer only pay off 9p (after interest) on a debt of nearly £800- as that would take a wee while to clear in that way- too long for me to even be bothered to work out!!
TIA

it's perfectly possible that the actual interest would be more so that your debt would increase

bengal-stripe

sheba wrote: »

.....if I were having to pay the minimum amount my overall bill would reduce by 9p!! My query is: I thought legislation(?) had been brought in to make cc lenders ask for a % of balance as a minimum.....

Barclaycard's minimum payment is 2.25% of the outstanding balance plus the interest due and charges (if applicable).

PeacefulWaters

sheba wrote: »

Morning all,
Just popped on here as had a query re credit cards and minimum payment levels vs interest. This is merely a query, as I settle my bill in full each month on my Barclaycard cashback account so pay no interest at all

A wise approach.

but I noticed on my most recent bill of £798.05 the minimum payment is £15.96 whilst the estimated interest is £15.87, meaning if I were having to pay the minimum amount my overall bill would reduce by 9p!!
My query is: I thought legislation(?) had been brought in to make cc lenders ask for a % of balance as a minimum so that any payment made makes real ingress into the 'debt', even with interest added.

I believe this applies to cards issued after a certain date.

Do you think the amount I have quoted (minimum payment particularly) has been reduced by credits made to my account by way of refunds in the past month?

You can work it out based on the monthly interest rate and statement balance.

I just can't believe that any financial institution would be allowed to let a customer only pay off 9p (after interest) on a debt of nearly £800- as that would take a wee while to clear in that way- too long for me to even be bothered to work out!!
TIA

I can't believe that consumers would be stupid enough to pay so little for an extended period of time. But it does maximise financial flexibility.

SnowTiger

sheba wrote: »

Just popped on here as had a query re credit cards and minimum payment levels vs interest. This is merely a query, as I settle my bill in full each month on my Barclaycard cashback account so pay no interest at all, but I noticed on my most recent bill of £798.05 the minimum payment is £15.96 whilst the estimated interest is £15.87, meaning if I were having to pay the minimum amount my overall bill would reduce by 9p!!
My query is: I thought legislation(?) had been brought in to make cc lenders ask for a % of balance as a minimum so that any payment made makes real ingress into the 'debt', even with interest added.

As PeacefulWaters says, I think that only applies to (more) recent credit card contracts. Putting that aside...

The minimum payment is THIS month's minimum payment, which doesn't include interest.

Let's say the minimum payment is 2.5% of the outstanding balance, plus interest. There isn't any interest charged on this month's statement, so the minimum payment would be 2.5% of the outstanding balance.