Halifax Clarity interest when withdrawing cash

ChristopherM87

I withdrew cash in a foreign currency with an ATM. At the end of the month I got my statement and had been charged interest on this transaction even though it's not time to pay.

I always pay off when the payment is due at the end of the month and plan to this time as well. Is this interest a mistake? It seems illegal as I had not had a chance to pay off my balance in full yet?

Martico

Sorry, cash withdrawals on credit cards always attract interest

MorningcoffeeIV

Nothing illegal - it's all good.

If the level of interest is an issue for you, then pay it (and the whole current balance on the card) off immediately after withdrawing the cash.

born_again

MorningcoffeeIV said:

Nothing illegal - it's all good.

If the level of interest is an issue for you, then pay it (and the whole current balance on the card) off immediately after withdrawing the cash.

So long as you have cleared the balance from last statement.

If you have any remaining debt from last statement, any payments pre next statement, go towards previous balance.

MorningcoffeeIV

That's why the OP needs to pay off the cash AND the whole current balance.

The current balance includes all previous transactions.

grumbler

Martico said:

Sorry, cash withdrawals on credit cards always attract interest

I think there was some CC (Barclaycard?) that didn't charge interest on cash withdrawn abroad.

Martico

grumbler said:

Martico said:

Sorry, cash withdrawals on credit cards always attract interest

I think there was some CC (Barclaycard?) that didn't charge interest on cash withdrawn abroad.

Quite possibly, I'm not sure. I just play safe and don't ever do it. But yes, good to call out inaccuracies on sweeping statements, thanks

Andy7856

It is in T&C's you signed up.  So accepting them you must have been in agreement with? . So either,

1) Ditch the card to another (Barclays Reward does not charge interest), or
2) Pay off full account balance once transaction paid - each and every time, or 
3) Accept the fact that the interest is peanuts compared to what other cards may charge you (interest +  Cash charge + commission load) and you are still quids in over the long term to what you could have been in for.

CliveOfIndia

ChristopherM87 said:

Is this interest a mistake?

No, standard practice - cash withdrawals incur interest, even if you pay the balance in full (unlike purchases).  But unless you're withdrawing very large sums, the interest usually works out to be less than the charge you'd incur if you were to use your debit card (unless you've got one of the relatively few fee-free debit cards).

grumbler said:

I think there was some CC (Barclaycard?) that didn't charge interest on cash withdrawn abroad.

This is correct (and is mentioned in the main "Cards & Loans" article).  But this is pretty much the exception to the rule - most cards, even the so-called "Travel" cards, will charge interest on cash withdrawals (where they beat a "standard" credit card is by not charging an FX fee on every foreign-currency transaction).

[Deleted User]

It's usually better to use a forex free debit card to withdraw cash  - it doesn't get noted as a cash advance on your credit report either.

ChristopherM87

[Deleted User] said:

It's usually better to use a forex free debit card to withdraw cash  - it doesn't get noted as a cash advance on your credit report either.

Can you recommend one? I have the Revolut but that doesnt work on weekends.