Interest on Interest Free Balance

lucknnow

Hi All,

I have recently made two 0% transfers, one to MBNA bmi and another to Lloydstsb.

I have just received the second statements from both since the transfers and I noticed that there are interest charges levied on the accounts. The interest are very small 11p on the mbna (transfer of £5K) and 41p on the lloydstsb (transfer of £2K).

Why are these interests being charged for? The minimum payment are paid by direct debit so there are no late payments and there are no other credits like purchases on these cards other than the fees that they charge for the transfers.

I have done other balance transfers on other cards before and have not come across these interest charges before.

Can anybody enlighten me, please?

Best regards,
lucknnow

thumshie

My guess would be that they're charging interest on the BT fee..

lucknnow

surely that cannot be the case. that would be paying double interest. having paid for the transfer I now have to pay interest on the fee as well??? that is criminal

napoleon

This is how credit cards tend to work. Firstly they rip you off and then they charge you for ripping you off.

lucknnow

one of the bt (the mbna one) was done over the phone. the cs advisor on the end of the line made no mention that the fee was liable for interest.

i assumed that the 3% was all that i need to pay until the end of the zero interest period ends.

how do these cc companies get away with these underhanded tactics?

napoleon

You get ripped off, conned and then right royally shafted. This is the world of credit cards.

It's a great wheeze, I just wish I'd thought of it.

exel1966

napoleon wrote: »

You get ripped off, conned and then right royally shafted. This is the world of credit cards.

It's a great wheeze, I just wish I'd thought of it.

Napoleon, change the record will you ! Noboby is getting ripped off as it's common practice for many cards to charge interest on the BT fee. There's nothing new or uncommon about it.

Those who use credit cards wisely get to use them to their full advantage, and those who are even wiser get to make money from their credit card, whereas those who usually shout 'Rip Off and Con' are usually those who have abused their privelage of having a card.

Lucknow, I'm sure a quick perusal of the T&C's will show you exactly how it all works.

King_Weasel

Personally, I've never heard of interest being charged on bt fees, and I've paid a few in my time, but maybe I'll be stung next.

Lucknnow, I don't know why you were charged interest but I know someone who may. Why not ask their Customer Services? As it's happened in two cases it doesn't sound like a mistake, but at least you will get an answer. I'd quite like to know myself, too, if only to avoid these cards.

YorkshireBoy

Lloyds say (very clearly)...

For each individual balance transfer there is a 3% fee. Interest is charged on balance transfer fees.

http://www.lloydstsb.com/credit_card_app/balance_transfer_important_info.asp?WT.svl=CARDINFObt1

With the MBNA card, there are two possible reasons...

1. There was an existing (perhaps purchase or cash advance) balance on the card, and it is this which is incurring interest, or

2. There has been a mistake.

jamalfatty

Dont know about Lloyds TSB, but the BT fee on an MBNA account is charged at same rate as the BT, so if it's on 0% its not the fee causing the interest. Do you have PPI that could be causing the interest? Or could it be interest leftover from last statement?
Just ring them up and ask, they should be able to tell you whats causing it.