Paying off balance vs interest being charged

onetimeatponycamp

I'm slightly confused about how interest is charged on a credit card vs the balance being paid off. My understanding of this has been that you are not charged interest on a balance if the balance of that statement is cleared by the due date.

So, if I had £200 balance on my credit card statement when it was issued on 1 December, I wouldn't be charged interest on that balance as long as I paid off the £200 by the due date of that statement (29 December). My understanding of that was that as long as I paid this £200 interest wouldn't be charged, even if by the time I made the payment the current balance of the card was £300. Is that wrong?

I'm looking at my previous statements for my credit card:

- Statement issued 1 October, full statement balance paid off before due date (but not full balance on date the payment made).

- Statement issued 1 November, full statement balance paid off before due date. Interest charge on statement.

- Statement issued 1 December, full statement balance paid off before due date. Interest charged on statement.

- Statement issued 1 January, again interest charged on statement.

Can anyone explain to me why this interest is being charged?

[Deleted User]

Most likely is that there is a cash transaction in there.

molerat

And assuming the card is one that does have an interest free period - there are a couple out there that don't and at least one is from one of the major high street names.

And paid off before the due date or credited to the account before the due date, makes a big difference.

onetimeatponycamp

Deleted_User said:

Most likely is that there is a cash transaction in there.

It's all ordinary purchases.

molerat

Some "ordinary purchases" are deemed quasi cash transactions by some cards

onetimeatponycamp

molerat said:

And assuming the card is one that does have an interest free period - there are a couple out there that don't and at least one is from one of the major high street names.

And paid off before the due date or credited to the account before the due date, makes a big difference.

Yes, it does have the interest free period (it's Halifax). They do say on the statement that they don't charge interest if you pay off in full and have also paid off previous month in full, but again this doesn't explain the interest on the three consecutive statements.

I'm assuming the date credited is the date it shows on the statement, so yes in that case all payments within the period (I went through statements and worked on the dates on there, not on dates money left any other account).

onetimeatponycamp

molerat said:

Some "ordinary purchases" are deemed quasi cash transactions by some cards

Oh! Where can I find info on these? Have just done a quick google but not found anything helpful.

[Deleted User]

Cash, gambling, forex, charity payments occasionally....

onetimeatponycamp

Deleted_User said:

Cash, gambling, forex, charity payments occasionally....

Nope, none of those.

Just looked again, and on the statements it's all being categorised under purchases.

[Deleted User]

Then the remaining options are - 

• payment wasn't made by due date 
• only partial payment was made by due date
• previous statement was not paid off in full 
• a system error

You don't have a 0% balance also running, do you, that you're not paying off?

CurlySue2017

I closed my account with them because of this - I have no idea what causes it but it does happen.  I would pay off the balance in full, well within the payment date advised and then the following month I would receive another statement with interest charged (usually only pennies) for the period between the statement date and the payment being received.  When I rang them to ask what was going on, they couldn't give an explanation and the interest was always credited, but it was a pain having to keep chasing them, so in the end I closed the account.

I used to use their 0% balance transfer offers aswell, but they often charged interest by mistake on those too.  Again, they were always corrected when I contacted them but the hassle of having to keep doing that was not worth having the card.