Confused!

tanyab

I always pay my Credit Card Statement in full each month so it doesn't matter to me. However I was really confused by what the Barclaycard Customer Services said to me.
Surely this can not be true?
She said if you pay your minimum balance or any figure over it but under the statement amount you get charged Interest for the whole Statement that month?
For example if the month's Statement comes to £700 and you pay £650 pounds you are still charged the Interest rate for £700 and not on the £50 outstanding??
Is that the correct info?

eskbanker

Yes, all credit cards work like that - the interest (on the full statemented balance) is only waived if you pay the balance off in full, as per http://www.moneysavingexpert.com/credit-cards/best-0-credit-cards#rule2:

However, don't almost clear your card in full – clear it IN FULL if you can. For example, if you've £1,000 debt from spending on a credit card and pay off £999, the fact it's not cleared IN FULL means you pay a month's interest on the whole amount.

molerat

I remember a thread here a while back where someone had a balance of something like £xxx.86p but paid £xxx.68p in error and were most upset being charged interest.

EarthBoy

As eskbanker says, all credit cards work that way.

bigadaj

tanyab wrote: »

I always pay my Credit Card Statement in full each month so it doesn't matter to me. However I was really confused by what the Barclaycard Customer Services said to me.
Surely this can not be true?
She said if you pay your minimum balance or any figure over it but under the statement amount you get charged Interest for the whole Statement that month?
For example if the month's Statement comes to £700 and you pay £650 pounds you are still charged the Interest rate for £700 and not on the £50 outstanding??
Is that the correct info?

The way to think about it is that you are always charged interest, but this is waived if you pay in full.

tanyab

Thanks everyone
I guess the only person who was surprised was me

PeacefulWaters

tanyab wrote: »

Thanks everyone
I guess the only person who was surprised was me

While you're not the only one to think that way it is an illogical thought process.

You have a debt, for a month perhaps, from spending on your credit card. You should pay interest from the date of purchase. You would on a loan. You would on an overdraft.

Nice credit card companies generously waive the interest. But only if you pay it off in full.