Paying off a Barclaycard cash transfer

ihatebarclays_2

16 months ago I made use of a 0% interest promotional offer and took out a £5,000 cash transfer from my Barclaycard to my current account. Since then the money has been sitting in my offset account, reducing my mortgage interest payments, so that's all good 

However as the end of the interest free period approaches (1st July) I'm puzzled about how to actually pay this money back.

I will get my usual monthly statement around 21st May, for payment by around 15th June. Am I right in thinking that so long as I pay the full amount shown on that statement, then my cash transfer will be regarded as paid back even if I have racked up new transactions in the meantime?

For example...

Statement on 21st May shows balance of £7,000
I pay them £7,000 by the due date (15th June)
However by that time my balance is back up to about £1,000 due to new transactions

Would I be safe from paying interest on the transfer? Or do I have to ensure my balance is zero actually on 1st July?

I have read the help section on the BC website and the full terms and conditions. You'd think they would be very explicit about this question - but they are not. I know about the general principle of how they assign payments (highest interest balances first) but it's not clear how that would apply here since the cash transfer interest rate is 0% (until 1st July) but the new transactions would also be 0% interest rate until around mid July.

Sncjw

Have you been paying minimum payments for your transfer in the time you had to? 

Brie

Have you been using the card for purchases and not been charged interest for those?  That's not very common.

Normally I'd say don't use it for any purchases whatsoever until the BT is cleared.  The reason is that as you have not paid your balance in full any purchases would have interest payable from the purchase date.  

So if everything on your card is at 0% currently and that 0% period ends on 1st July I'd say don't use it for purchases and pay the full balance off by 30th June.  Maybe do it a couple of days earlier to be on the safe side.  Then when the next statement is issued you know for sure you're in the clear and can start using the card for spending.  

ihatebarclays_2

Thanks both. Just to be more clear, this was a cash transfer, not a balance transfer. I pay off my transaction balance (i.e. total balance minus transfer) in full every month, so I never pay any interest on the Barclaycard,

figgyc

The different credit card companies pay balances off in different ways - hence the safe general advice is to avoid using a 0% BT/MT card for purchases as well. With some card providers you have to pay off the whole 0% amount before you can pay off the purchases, for example I have a Sainsbury's card that works like that.

As much as Barclaycard are rubbish in some ways, their "no interest grace period" on purchases is quite generous, if a bit confusing, and it can be used alongside a promotional rate - this page on their website explains it with a worked example: https://www.barclaycard.co.uk/personal/customer/interest-free-period which describes mostly what you have done. 

(It does also suggest that you should be paying the minimum payment of the MT on top of paying off the purchases? But I can't see where they are getting that interpretation from the T&Cs to be honest, those just say the minimum payment is just a number that needs to be paid to the card, there's no suggestion of different minimum payments for promotional rates and regular balance. And it seems that it is made up if as you say you've been paying off the purchases only and not being charged interest. Rubbish Barclaycard being rubbish as always.)

Here's what it says in the current T&Cs for most Barclaycard types, see here for others (underlines mine) - https://www.barclaycard.co.uk/content/dam/barclaycard/documents/personal/existing-customers/terms-and-conditions-barclaycard-core-2023.pdf

(a table further up clarifies that "main balance" = "standard balance" (OP's purchases) + "cash balance" (irrelevant here) + "promotional balance" (for OP, the MT) )

When we charge interest
If you pay your main balance (excluding any promotional balance with a 0% interest rate) plus any
instalment plan payments due for that month in full by your payment due date, the following will
apply that month:
• We won't charge interest on new transactions that have been added to your account since
your last statement.
• We will only charge interest on your outstanding balance from your last statement up to the
date of your current statement.

How we allocate payments
If a payment you make is less than your total outstanding balance as shown on your statement,
we'll use it as follows:
• If you have any instalment plans on your account, to make any instalment plan payments due
for that month.
• To reduce your main balance (your statement balance less any instalment plan balance).
We'll start with the balances charged at the highest interest rate first and then reduce the
lower-rate balances. If you have more than one promotional balance at the same interest rate,
we'll use your payment to reduce the balance with the promotional rate that ends first.
• If you have any instalment plans on your account, to reduce any remaining instalment plan
balance. If you have more than one instalment plan, we'll use your payment to reduce the
instalment plan that ends first.
If the standard balance includes default fees, we'll pay those off before the rest of the standard
balance.
When you make a payment, we'll always reduce the balances that appear on your statement
before we use your payment to reduce the value of transactions that haven't yet appeared on your
statement.

I assume if your May statement is on the 21st of May then your next statement is on the 21st of June for this.

My interpretation:

• On 21st May statement in your example you have £7000 balance, £5000 0% money transfer and £2000 of standard purchases
• In the meantime (between 22nd May and 21st of June) you do £1000 of spending. So on the 14th of june the current balance (that it says on your app or online) would be £8000
  
• You pay Barclaycard £7000 on/before the 15th June (make sure to adjust your DD or make a note somewhere to make a manual payment like the day before). Per the "statement balance comes before transactions that haven't yet appeared on your statement" rule, all £7000 of this goes to the balance that was on the 21st May statement. So the £5000 MT and the £2000 of May purchases would be cleared. (Even though, if unpaid, the £1000 of purchases would have a higher interest rate)
  
• Your new current balance would be £1000 of regular purchases
• A new statement is generated on the 21st June with a statement balance of £1000 and a due date of 15th July.
  
• That £1000 is still in the "grace period" until the June statement billing date, the 15th July, since it was done between the 22nd of May and the 21st June. So as long as you pay it off on or before the 15th July you wont be charged interest.
• You've not been getting charged interest for the previous months of purchases because the rule for that excludes 0% balances and you've been paying off all the purchases, which satisfies rule that you have to pay off "your main balance excluding 0% balances" to get the grace period
  

Probably best to be sure by calling up (although you're relying on the customer service agent being competent there), or playing it safe and not using your Barclaycard for purchases in the last month. I havent tried this myself, this is just what it seems to say to me.

ihatebarclays_2

Thanks. I will call them up just to be sure. I just knew I would get more sense form folks here!