Does a credit card refund count towards paying your next bill?

Bellatrixie

Hi,

I'm expecting a refund into my RBS credit card account in the next couple of days for an item I only bought a couple of days ago. My question is whether this credit will count towards paying my next bill, which is due in 2 weeks time. The item was bought and refunded during my current statement but the bill is obviously to pay my previous statement. Money is a bit tight at the moment so it would be nice to pay £30 less this month! I have contacted my bank and am waiting to hear back but just wondered if anyone on here knew or had previous experience figuring this out.

Many thanks!

Laura

Goldiegirl

When you get your next bill, the £30 will show as a credit on your account, so the balance of your account will reduce by £30, meaning you need to pay £30 less

grumbler

Bellatrixie wrote: »

Hi,

I'm expecting a refund into my RBS credit card account in the next couple of days for an item I only bought a couple of days ago. My question is whether this credit will count towards paying my next bill, which is due in 2 weeks time. The item was bought and refunded during my current statement but the bill is obviously to pay my previous statement. Money is a bit tight at the moment so it would be nice to pay £30 less this month! I have contacted my bank and am waiting to hear back but just wondered if anyone on here knew or had previous experience figuring this out.

Most likely it won't count, but it can reduce the amount taken by the DD. The latter was certainly the case for my Barclaycard recently.

bengal-stripe

With most Credit Cards a refund does not count towards the minimum payment. Otherwise some clever chap/esse could buy some item month after month, getting a credit a few days later; if this was regarded as the minimum payment, the card owner would never pay the minimum, let alone getting the balance down.

Of course, the refund will come off the balance, but you better make sure you pay at least the minimum on top of the refund.

InsideInsurance

It wont count as a payment but if the balance is 0 or close to 0 after the refund then it'll impact the payment due in that any minimum payment at most will ever take the balance to 0 rather than put it in credit

Bellatrixie

Wow, this forum is great! Thanks for all the speedy replies!

I just heard back from my bank. Apparently a refund does count towards paying your bill as long as it credits your account at least 6 working days before the bill due date (in the case of RBS). So my £30 will count! I think that's kind of strange and a bit of a crazy loop hole. It sounds to me like you could effectively get up to an extra 3 weeks interest free credit! Bit weird and I'm naturally suspicious of course! Since RBS advised I can, I will definitely take the £30 off my next bill payment to at least test it (worst that could happen is I get charged a little bit of interest) and I'll let you know how I get on.

Regarding minimum payment, I have a direct debit set up for this and ALWAYS pay it. RBS confirmed that minimum payment MUST always be paid 'cash' (cash over counter, debit card or bank transfer) - so a refund does NOT count towards this, be warned!!! Thanks to those who already pointed this out.

I should have explained that I always pay off the full amount of my credit card each month in order to not pay any interest (I don't have any special deals). So my refund will count towards this. Obviously only a short term solution but it will help a little with cash flow, especially over the summer when business is slow

jonesMUFCforever

Your next closing balance on your statement is the amount you have to pay to remain interest free.
The refund will already have been credited to your account.
If you pay £100 when the statement balance is £130 then you will be charged interest next month.

King_Of_Fools

Bellatrixie wrote: »

Since RBS advised I can, I will definitely take the £30 off my next bill payment to at least test it (worst that could happen is I get charged a little bit of interest) and I'll let you know how I get on.

Bear in mind that if it does not count as towards the full payment of the bill then interest will be charged on the full amount (not just the £30) back-dated to when you made the purchases and you will continue to be charged interest on the full balance of the card until you pay it off in full.

For example, if your average monthly spend on the card is £500 and your interest rate is 19.9% you might find you have a interest charge of £16.58 instead of the 50p you might expect!

Bellatrixie

Thanks again for the replies.

JonesMUFCforever, I have been advised by RBS that the refund does count toward the full amount as long as it credits at least 6 working days before the due date (and my minimum payment will be paid by DD). Whether that advice is correct remains to be seen but I have made a note of the call time and a name for the complaints procedure just in case!

That's a very good point King of Fools, silly me - I should have remembered I would be charged interest on the full amount. Luckily it's not a lot but even so, I'm not sure I'll do it now - I know I'd get the money back because of misadvice but not sure I can be bothered with the faff. I'll have a think about it...

jonesMUFCforever

Bellatrixie wrote: »

Thanks again for the replies.

JonesMUFCforever, I have been advised by RBS that the refund does count toward the full amount as long as it credits at least 6 working days before the due date (and my minimum payment will be paid by DD). Whether that advice is correct remains to be seen but I have made a note of the call time and a name for the complaints procedure just in case!

That's a very good point King of Fools, silly me - I should have remembered I would be charged interest on the full amount. Luckily it's not a lot but even so, I'm not sure I'll do it now - I know I'd get the money back because of misadvice but not sure I can be bothered with the faff. I'll have a think about it...

If your next statement states a balance of £130 O/S (and the refund is showing on that statement) then you need to pay the full amount of £130.
If the refund is still being processed and is not showing on the statement then yes you could pay £100 as long as the refund does go through.

Bellatrixie

Well, it's been a while but I now have a definite answer to my original question - I tried it and was not charged any interest!!

My minimum DD went out as usual in August, then I subtracted the £30 refund from the remainder owing on my July statement and only paid what was left after that. As I had been reassured by RBS, the £30 counted towards paying off my last statement, even though I had bought and returned the item since then!

I've looked into this and apparently it does not apply for all credit card providers, so BE CAREFUL!! But it does seem like a bit of a loophole. If you don't mind shopping and then returning items (either expensive items, or lots or cheaper ones) then it could be a sly way to get longer 0% interest, at least for an extra month or two depending on your spending vs credit limit. I admit it's a bit of a faff and not something I would do unless really desperate! But it seems strange to me that this, in theory, could be done and RBS allow it. I guess not many would actually try it though so they're not really bothered!

I'd be interested to hear anyone's thoughts?