Do not pay Barclaycard early

JimmyTheWig

InsideInsurance wrote: »

For what you are wanting to do, just pay the credit card after the DD has been collected and then there is no issue

If the DD was due to go out on, or close to, the payment due date then doing this might also result in the full balance not being paid on time and so interest being charged for the month.
Or if the account wasn't cleared in full last month then it would still result in a few more days' worth of interest.

littlerock

Now I am really confused. I missed my Barclaycard payment by two days last month due to a bad cold and got hit with interest and a late payment fee. So I have set up a direct debit to come out on earliest due date each month to cover minimum payment. Should I then pay full amount on actual due date (which can vary within 10 days each month) or the full amount less the amount of the direct debit? Or the full amount beforehand but apparently, not more than 3 days beforehand?


(What happens if direct debit is taken on same date as payment falls due, as could happen? As InsideInsurance said BC did not allow me to choose date of direct debit, it was set by BC to be taken on earliest date payment is due each month, 8th in my case. )

JimmyTheWig

littlerock wrote: »

Now I am really confused. I missed my Barclaycard payment by two days last month due to a bad cold and got hit with interest and a late payment fee. So I have set up a direct debit to come out on earliest due date each month to cover minimum payment. Should I then pay full amount on actual due date (which can vary within 10 days each month) or the full amount less the amount of the direct debit? Or the full amount beforehand but apparently, not more than 3 days beforehand?


(What happens if direct debit is taken on same date as payment falls due, as could happen? As InsideInsurance said BC did not allow me to choose date of direct debit, it was set by BC to be taken on earliest date payment is due each month, 8th in my case. )

Lets say statement balance is £100.
Minimum payment is £10.
Due date is 10th January.
DD date is 8th January.

You want to pay the full balance. Either...
* Pay £100 with enough time for them to not request the DD from your bank (e.g. before 4th January)
* Pay £90 after the cut-off for the DD (e.g. some point between 6th January and 10th January)

Herbalus

If you set up a DD to repay the card in full then this problem is avoided.

But if I only had a DD for the minimum then I'd pay the full balance immediately upon receiving the statement. That should be before the DD is actioned, but depends on whether the CC company would take it anyway. The minimum should not be that much however, and will simply come off next months bill.

InsideInsurance

JimmyTheWig wrote: »

If the DD was due to go out on, or close to, the payment due date then doing this might also result in the full balance not being paid on time and so interest being charged for the month.
Or if the account wasn't cleared in full last month then it would still result in a few more days' worth of interest.

It depends on the company, cant say for BC as havent used it in an age, but for example AmEx credit a debit card payment immediately to your account despite technically they wont have cleared funds so to avoid interest the following month you could certainly pay it on the DD day or a couple of days after and not risk anything.

If you didnt clear in full last month then yes you want to clear as early as possible to reduce the trailing interest but technically that would include the minimum payment amount too so the BC and Santander approach helps here as you pay it off in full ASAP, the DD is automatically stopped etc. Obviously this does go back to the OP having to remember that this doesnt work with the RBS Group approach and others like them.

chattychappy

Oh people love DDs on this forum. It can only be the OPs fault for not understanding how they work and interact with manual payments.

I prefer peace of mind, so I never use DDs. I pay what I want to pay, when I want pay it.

Cycrow

InsideInsurance wrote: »

It depends on the company, cant say for BC as havent used it in an age, but for example AmEx credit a debit card payment immediately to your account despite technically they wont have cleared funds so to avoid interest the following month you could certainly pay it on the DD day or a couple of days after and not risk anything.

barclaycard do if you pay from a barclays account, its usually cleared within 2 hours of payment.
Not sure about paying from somewhere else thou

lulu_92

I just manually pay mine off in full every month. Had no issues.

littlerock

Yes well I always paid in full each month until last month when I was knocked out with flu and was two days late paying BC. Not only did I get stuck with late payment charge and interest, but also got snotty letter from BC saying if I was late once more they might have to cancel the card. (Should add that I am nowhere near credit limit and have never been late paying before.)

So to avoid repeat of that scenario, set up direct debit for minimum payment. HOWEVER I cannot chose date it goes out of my account, BC do that and they set it up to leave my account on first possible date statement is due,(8th in my case) although actual statement can vary between 8th and 18th each month (again this is according to BC).

To be honest setting up the direct debit seems to have made things more complicated as now I still have to remember to pay but to pay the full balance before it is due rather than on due date. :

Anyway I will pay in full today, 7th, to leave my account immediately, and see what happens.

InsideInsurance

chattychappy wrote: »

I prefer peace of mind, so I never use DDs. I pay what I want to pay, when I want pay it.

I prefer peace of mind, they are all paid by DD so if I am working odd hours/ travelling at no notice etc I dont have to stop and think about when was the last time a random one of my credit cards was last paid/ is next due but get on with life knowing they will be paid on time at almost the last possible moment to maximise my interest free period.