Amex charges interest despite balance being in credit

mw47938

For JUL, my balance on my Amex credit card (not charge card) was £49.98 and a minimum payment of £5.00 taken by direct debit was taken on 25 JUL. On 23 JUL, my Amex account received a refund of £282.48 which brought the my current balance into credit. The £5.00 direct debit went ahead regardless but I made no further payments; yesterday, I checked my account and noticed it said it was overdue, I rang Amex and they explained that my JUl balance of £44.98 was still unpaid and therefore I would be charged interest.

I find this very wrong; they agreed to waive the interest this time but I think Amex should count refund towards the balance by default.

Cheers
Michael

bengal-stripe

mw47938 wrote: »

I find this very wrong; they agreed to waive the interest this time but I think Amex should count refund towards the balance by default.

Quite a few cards do not consider refunds as repayments (and certainly not as the minimum) as it is open to abuse.

Think of the following scenario: to 'pay' my CC, I use the card to buy something, three days later I get a refund. So, my balance got 'paid', without costing me a penny; either as the initial outlay, nor in interest as I did 'pay' in full. Presuming I play that trick for several months, I will have just rolled my balance along and saved a pretty penny.

mw47938

I can see your point about rolling along the balance but I can't see that I would save anything. Assuming I didn't make any other purchases other than the pretend-buy-to-get-refund ones each month then all I would "save" is the minimum payment but at the same time my balance would increase every month by more and more interest. So in the end I would pay more and the bank would make more money from me.

Mr_K

Take all the guesswork out of it and pay the full balance by DD. I believe that is there is also refund/extra payment, such a DD is adjusted if there is enough time.