Do not pay Barclaycard early

gcdwz

Barclaycard charged interest on my credit card account when I paid them 4 working days before the due date.


I have direct debits set up for all my credit cards so that the minimum payment is collected on the due date. This helps me to avoid charges should there be any reason that I have not made payment by the due date. (lost in post / illness etc.)


I then use internet banking to pay the difference between the total balance and the minimum payment that they will be collecting by direct debit.


Last month I made the internet banking payment (for the difference between the statement balance and the minimum payment) 4 working days before the due date and Barclaycard then chose not to collect the minimum amount by direct debit.


Having not collected the minimum payment, Barclaycard then charged me interest on the total statement balance.


When I called Barclaycard they were insistent that it is their policy to not collect direct debits if any other payment is received more than 3 working days before the due date.


Barclaycard have agreed to refund the interest charged but I still think their policy is unreasonable.


Has anyone else had similar problems?

Tixy

A number of credit cards do this, it is not unusual.

Others state they will collect the minimum payment regardless of any other payments you make.

Almost certainly this will be explained in the t&cs/paperwork. But nice that they refunded your interest as a goodwill gesture this time.

In terms of the interest they then charged you - they'll have charged it on the daily outstanding balance, not on the whole statement balance for the whole of the month.

bengal-stripe

Some CC will collect payment by DD regardless of any additional payments, others will adjust the DD or cancel it if they receive a payment before the DD goes out. It's up to you to inform yourself which way your card operates.

A card (like MBNA) that operates differently will catch out the uninformed as well: "I paid my card in full, nevertheless they collected the DD 10 days later, now I'm overdrawn!"

forgotmyname

Instead of paying the difference why not just pay the full balance? Thats what i do and they never take the DD payment.

Kim_13

Charging interest on the full balance rather than just the bit not cleared? Cheeky gits! Glad to hear they refunded it.

I only have a Capital One card and they will take the direct debit (amended if the additional payment is a certain number of days before the DD date) unless the balance is cleared in full. I just thought it was industry standard, as as far as I'm concerned, that's responsible lending.

lazer

I have a Barclay card with a £3k interest free balance on it.


I was buying a holiday my other credit card kept getting declined (As Tesco don't seem to like Irish transactions), so I had to use my Barclaycard for around €800.


After the transaction showed up on my online banking, I paid that amount of my card, however Barclaycard allocated the payment to my balance transfer amount, as supposedly any payments will always get allocated to the previous statement balance and not the current outstanding balance. So when the minimum payment was taken the next month, I was left paying interest on the €800. Thankfully I checked my statements and noticed this, and it is now been rectified by Barclaycard but worth keeping an eye on

InsideInsurance

As others have said, there are three options for card issuers:

1) Still take the full amount by DD - Natwest/RBS
2) Adjust the amount down by the earlier payment - Barclaycard
3) Stop the DD even if the payment is below the minimum - Santander

Personally I find the Barclaycard one the most sensible as the other two are more likely to leave you in problems either with a credit card in credit and an overdrawn current account or a missed/insufficient payment fee.

Whichever it is its a case of knowing and dealing with this appropriately. For what you are wanting to do, just pay the credit card after the DD has been collected and then there is no issue

redux

You could do the opposite - move the direct debit for the minimum payment forward a few days so your manual payment will follow it.

Mr_Goodkat

This will be clearly explained in the terms and conditions and it is important if operating a credit card in this manner that you understand how they deal with taking direct debit payments and manage the account accordingly.


If you always pay off your account in full then why not just have a DD in place for the full statement balance rather than over complicating things with a minimum payment direct debit and a manual payment of the difference?


You either need to send a full payment to the account BEFORE the DD is due to be taken or make a payment of the difference AFTER the DD has been taken.

InsideInsurance

redux wrote: »

You could do the opposite - move the direct debit for the minimum payment forward a few days so your manual payment will follow it.

That depends on the credit card company. As the statement dates change at times its normally not a set date but simply X days before the due date with X not being variable.

Certainly none of my card issuers allow you to choose the date when the DD is taken any more.

JimmyTheWig

forgotmyname wrote: »

Instead of paying the difference why not just pay the full balance? Thats what i do and they never take the DD payment.

That's a reasonable suggestion...
... unless the OP didn't realise they needed to. (Which, presumably, they didn't.)