Charged for purchases straight away.

Asghar

I currently have a Natwest credit card with a 0% balance transfer until next year.

Last month I decided to make a few purchases on it which I intended to pay off in full, (on top on the normal DD amount), after the next statement.

However when I received the statement yesterday, I found that I had been charged interest on the purchases, even though this is the first statement that they have appeared on.

I spoke to NatWest yesterday and was told it was a banking error and would be corrected, but nothing yet. I would have thought my balance would have been amended straight away but the balance and available credit has not changed.

I did make a purchase on the card when I first got it which was fine, paid it off with no interest and then did the balance transfer.

[Deleted User]

Banks should always apply the credit to the debt that will accrue interest first (or the most interest) but it's generally considered a bad idea to spend on cards you have a BT on because of the risk the money might be used on the BT not the purchase. Yesterday was Saturday, the call centre staff may be working but the main ones won't be in until Monday, so chase end of tomorrow.

[Deleted User]

As you're not clearing the balance in full, you'll be charged interest on the purchases.

Use a separate card for purchases and clear that card in full each month.

Aran76

Although you have done nothing wrong here and the bank have admitted their error, to re-iterate what everyone else has said - you should never use balance transfer cards for purchases. It's one of the many tricks that card providers use to get you to give them money.

Asghar

Yeah, I messed up trying to be clever.

I thought I would still have up to 56 days interest free on purchases which i intended to pay off in full after the statement because the higher rate would be payed off first.

NatWest sent me an email this morning with a reminder of when the promotional rate was ending and other things I needed to know, like if I carried any balance forward from a previous month (including 0% balance transfers), then interest will be charged on purchases from the date they are debited to your account.

Now instead of waiting till the due date, I have paid off the amount of the purchases plus the small amount of interest this morning, two days after the statement date.

Asghar

Aran76 said:

Although you have done nothing wrong here and the bank have admitted their error, to re-iterate what everyone else has said - you should never use balance transfer cards for purchases. It's one of the many tricks that card providers use to get you to give them money.

I think I must have managed to convince the person I spoke to that it was error. When looking at the email they sent this morning it wasn't and the interest charged was correct.

Lesson learned, even though the interest amounted to less than a pound.

Asghar

Deleted_User said:

As you're not clearing the balance in full, you'll be charged interest on the purchases.
Use a separate card for purchases and clear that card in full each month.

As I have now paid off, (via faster payment), the purchases amount plus interest only two days after the statement date, then will I only have two days worth of interest on the next statement? It can't be for the whole month can it.

It was in my head that only cash advances incur interest from day one, but now obviously not if you have a trailing balance left over.

Fingerbobs

Asghar said:

Deleted_User said:

As you're not clearing the balance in full, you'll be charged interest on the purchases.
Use a separate card for purchases and clear that card in full each month.

As I have now paid off, (via faster payment), the purchases amount plus interest only two days after the statement date, then will I only have two days worth of interest on the next statement? It can't be for the whole month can it.

It was in my head that only cash advances incur interest from day one, but now obviously not if you have a trailing balance left over.

All transactions incur interest from day 1. However, interest on purchases is waived if the statement balance is paid IN FULL (not just the purchase balance) before the due date. 

chistery

Barclaycard do it quite nicely, allowing you to use the card when you have a balance transfer, and just make sure you pay off your standard balance by the due date and you won't get charged interest.

alewin

chistery said:

Barclaycard do it quite nicely, allowing you to use the card when you have a balance transfer, and just make sure you pay off your standard balance by the due date and you won't get charged interest.

That's how it should be, makes more sense. Then you can carry one paying the promotional rate balance transfer as usual and on top of any occasional spending.

The way NatWest seem to do it, you cannot use the card for purchases until the balance transfer is paid off, they want you to just stick it in a drawer and forgot about it.

[Deleted User]

alewin said:

chistery said:

Barclaycard do it quite nicely, allowing you to use the card when you have a balance transfer, and just make sure you pay off your standard balance by the due date and you won't get charged interest.

That's how it should be, makes more sense. Then you can carry one paying the promotional rate balance transfer as usual and on top of any occasional spending.

The way NatWest seem to do it, you cannot use the card for purchases until the balance transfer is paid off, they want you to just stick it in a drawer and forgot about it.

I have a NatWest card I got for BT and they allow you to spend on it fine