PPI on Credit Cards - any maths experts?

lotto-dreamer

Can someone less mathematically challenged please clarify this -

If I have PPI on a credit card (and not as separate insurance) does this mean that the PPI element (90p per pound of outstanding balance) gets added to the total outstanding credit card balance each month and therefore attracts interest and that is rolled up the next month with the outstanding balance to attract more interest and to which PPI is then again added? .....or is it applied separately?

I'm not sure if I'm being dumb but this is worrying me (and getting me very worked up :mad: now that I have looked at my credit card statements - or I could just be overtired )

CLAPTON

why not just cancel PPI? It rediculously expensive and rarely pays out...
if you really think you need it then take out independant insurance.. a lot cheaper

benf90

There's a guide on here which you can have a read through to decide whether or not to cancel it. Or, if you do want the cover then whether or not to switch to a cheaper provider.

It can be found here:

http://www.moneysavingexpert.com/cards/credit-cards-protection

I presume your original post meant 90p per £100 of the balance and not 90p per pound? If so it's still seems expensive compared to others.

The charges for it get added to your card balance (so make sure you have enough available credit for them so that you don't go over the limit!).

Usually the minimum payment for a card will always cover at least interest + any charges. So, your minimum payment will clear off the charges for the cover each month.

But... as you're paying for the payment protection it means less of your money is going towards clearing the actual balance of the card.

Whether or not the payment protection charge incurs interest between the statement date (when the charge is applied) and the date the payment is made all depends on your cards T&Cs.

lotto-dreamer

Thanks very much Clapton and also for the link Benf90

Aargh.......:mad: I'm learning, wish I'd had this knowledge years ago. I'm not sure if I was mis-sold it or not but would, if necessary, always take it out separately now.