Paying interest on non-Sterling transaction fee

clairec666

I recently had to use my credit card to make an emergency purchase abroad - a non-Sterling transaction fee was applied, of about £2. (In hindsight should have used a different card with no fees, but that's irrelevant now.) I've got 0% on purchases for 20 months, but am being charged interest on that £2 - only a tiny amount each month, so hardly worth worrying about, but a tad annoying seeing it on my statement.

I'm not paying the card off in full each month (I have enough savings to pay it all off when the 0% deal ends). Am I stuck with the annoying few pence of interest each month, or will it disappear now I've paid off some of this month's balance?

grumpy_codger

I'm pretty sure the first payment will eliminate the interest-bearing fee. You even can make a small manual payment before the due date.

clairec666

Thanks. I wasn't sure whether payments were applied on a "last-in first-out" basis.

grumpy_codger

clairec666 said:

.... I wasn't sure whether payments were applied on a "last-in first-out" basis.

The payments are applied to the part of the balance with higher interest in the first place.

MyRealNameToo

grumpy_codger said:

clairec666 said:

.... I wasn't sure whether payments were applied on a "last-in first-out" basis.

The payments are applied to the part of the balance with higher interest in the first place.

However the debt will still be accruing interest between when the statement is produced and the payment is made. 

Card terms vary between products, some require the full balance to be cleared for 2 statements in a row, some limit it to just interest bearing balances