Odd refund behaviour on PayPal credit

slippery_penguins

I've made two purchases with paypal credit, the first larger one using their introductory 0% over 4 months offer, then a second smaller one that gave me the option of 0% apr over 24 months, in fixed installments. I was planning to pay the minimum on my first statement, then pay off in full on the second - incurring 0 in interest.

I returned the second purchase, so I received a refund, but I can see that instead of actually refunding that transaction, they've applied the refund amount to the first purchase instead. I can see it still there in my account in the list of to-pay purchases.

I called them to ask about this and they told me that refunds are processed as payments towards the account, so go towards the oldest transaction "to minimise interest accrued" (their words, not mine). I understand what they mean, but it still feels deceitful to me for some reason. While the interest accrued would be lower if I only paid the minimum amount every month, if I'm paying it off in full before the 0% ends but not immediately, it just makes my minimum payment for the first statement higher doesn't it?

Their user interface is a bit different from 'normal' credit cards, as it shows the progress for paying off individual transactions - not just the lump sum for your last statement, but this way of processing refunds feels like a weird way of doing it? Unless the others CCs do this as well but don't show you?

Please enlighten me thanks.

Nasqueron

There is no definitive answer, some definitely don't use it towards the balance as there was a post about it recently, if PayPal want to do it that way that is their choice.

Their approach will be in their Ts & Cs, it's definitely not deceitful.

Largs

I can't remember the details as it was a while ago, but I got caught out by how PayPal works and what I learned was when I use it for a purchase on some kind of interest free deal, (or pay in 3 and 12 months), not to use it for anything else until that is dealt with as the paymets are applied in an order that seemed different to what I was used to.  I think I had 2 plans running at the one time but can't now remember the details.