Bank deducting interest

purple_kathryn

I was checking my bank (of ireland) account online and apparently the bank have deducted £2 from my current account under interest (they have also added 7pence also under interest)

I'm trying to figure out why

I did dip into the red last month because they took my credit card out the day before my pay went in which they already penalised me for (once for using my overdraft and once for being over my overdraft totalling £38 which is ridiculous enough).

I don't see how they have the right to take more money off me though (even if it is just £2) :mad:

YorkshireBoy

Debit interest is charged on the money you borrow from the bank when you go overdrawn. There may be two rates...authorised and unauthorised. Because you've incurred a charge you will have incurred at least some of the higher unauthorised rate interest.

Credit interest is paid when your account is in the black.

The above is in addition to any fees you made have incurred for your transgressions.

Why not move your credit card payment due date back a few days, or ask for an increased overdraft facility?

purple_kathryn

YorkshireBoy wrote: »

Debit interest is charged on the money you borrow from the bank when you go overdrawn. There may be two rates...authorised and unauthorised. Because you've incurred a charge you will have incurred at least some of the higher unauthorised rate interest.

Credit interest is paid when your account is in the black.

The above is in addition to any fees you made have incurred for your transgressions.

Why not move your credit card payment due date back a few days, or ask for an increased overdraft facility?

There is something to be said for mattresses

Thanks for your answer.

Funny that it's £2 for being ONE day in the red and 7p for 30 days in the black.

My pay goes in on the very last banking day of the month (in this case the 31st of October). For some reason my CC went out on the 30th. It's normally on or after my pay as gone in (eg in August it went on 31st August and the September one went out on the 2nd October). CHecking back the entire year this is the only time it's gone out before my pay has went in

purple_kathryn

double post

YorkshireBoy

purple_kathryn wrote: »

Funny that it's £2 for being ONE day in the red and 7p for 30 days in the black.

Not really, when you consider that the 'in credit' rate is probably only 0.08% and unauthorised borrowing rate is (up to) 32% EAR, ie 400 times more!!

My pay goes in on the very last banking day of the month (in this case the 31st of October). For some reason my CC went out on the 30th. It's normally on or after my pay as gone in (eg in August it went on 31st August and the September one went out on the 2nd October). CHecking back the entire year this is the only time it's gone out before my pay has went in

It's too close for comfort, as you have now found. As I said earlier, you'd be well advised to request your statement date (and hence the payment due date) is moved back a week or so.

There's some useful advice on how to avoid charges on the BOI website:
http://www.bankofireland.co.uk/pdf/charges-explained-flyer-web-version002.pdf