'Cash advance fees' and interest

Alex1987

Hi all

I was having a chat with a lad in work today about credit cards and he told me that he had used his new card recently for deposits on gambling sites.

He said that he had made 5 deposits of £10 and for each one, he was charged £3 - I explained this is probably because his card company would treat it like a cash advance, is this correct?

What did confuse me however was that he said his statement then showed interest on it. Is this correct? I would have assumed that the cash advance fee was essentially the charge?

MallyGirl

there will be a cash advance fee, plus most cards apply daily interest from the date of the cash advance as well - cash advances are not included in the 'up to 56 days interest free' deal you get with normal transactions.

Dobbibill

You are quite correct - gambling, foreign currency and cash advances are all treated as cash withdrawals meaning you pay 3% or a min of £3, plus interest from the date of the transaction.

derps

He will want to pay it off ASAP as the interest will accrue daily. He would also do well to slightly overpay to avoid trailing interest being accrued while the payment is processed.

RG2015

JackM wrote: »

The interest, unless otherwise permitted, will commence from the date of the transaction, rather than allowing for a set period of 0%*, which most credit providers will accommodate for normal purchases.

* 0% interest on standard purchases for an average of 56 days, please refer to your signed credit agreement for exact specification information and exclusions.

Isn't it a maximum of 56 days?

msallen

So an average maximum then

RG2015

msallen wrote: »

So an average maximum then

Ah yes, so it is. Mix up an imprecise mathematical term with an ambiguous language and the inevitable consequence is misunderstanding.

RG2015

JackM's posts have been deleted thus making some of the responses confusing.

Their assertion is that 56 days is the average of all banks' period of grace from the first dated purchase on the statement to the payment due date. Hence the maximum period of grace achieved.

dresdendave

Whilst I would never advocate using a CC to fund a gambling account, to minimise the cash advance fee he could have made a £50 deposit and then he could have made 5 x £10 bets. Obviously he would still be liable for the interest.

Hopefully the situation won't arise again as he can fund future bets from his winnings. If he hasn't got any winnings perhaps he needs to find a less expensive hobby.