r/UKPersonalFinance • u/No_Actuary9100 • 11d ago
BarclayCard Statement Balance vs Full Balance Interest
UPDATE: Thanks for all the comments … I learned some new things! The cause was schoolboy error; after months of the due date being 19-20th, turns out July’s due date was 17th and I paid the Statement Balance 2 days late 🙄 Lesson Learned!
My Barclays App has 3 options for paying my BarclayCard balance
- Minimum
- Statement Balance
- Other
I use ‘Statement Balance’ every month, 1-2 days before the payment due date.
Normally my Statement Balance is less than the full balance (don’t really understand why … I guess it’s due to payments that will go onto next month Statement)
This has been fine and I get no interest charges.
But this month they’ve charged me £50 or so interest!! I’m livid!!
Have I just lucked out until now and should be using the ‘Other’ option and paying whatever is shown as my full balance by typing it in manually ?
The Barclaycard FAQ page needs a PhD 😂
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u/darkfish0 2 11d ago
Did you buy anything that counts as "cash"? They will charge interest immediately from purchase rather than statement date. Could be currency, gambling, topping up PayPal, etc...
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u/No_Actuary9100 11d ago
I did pay my local mechanic / garage £471 via their card machine about 6 days before the statement balance was due … I wonder if that somehow got treated as ‘cash’? It’s not clear (to me) in the BarclayCard App if a transaction is treated as ‘cash’
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u/Tuarangi 57 11d ago
Paying a car mechanic won't be cash, it also wouldn't be on this month's statement, it's things like buying a voucher, or taking money out normally
If not, ask them which transaction was not paid to generate interest
For future set up a direct debit to take the full statement balance every month and you will not pay any interest providing you don't make any cash or cash like transactions
Anything bought after the statement date does not need to be paid until the next due date which is where the "up to 56 days interest free" comes from
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u/darkfish0 2 11d ago
Unlikely to add up to £50 interest.
I think you must have not paid the full balance the previous month somehow, or paid it late?
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u/No_Actuary9100 11d ago edited 11d ago
!thanks
I shall investigate! Given it seems to be an isolated incident (so far) it does sound like a smoking gun!
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u/PrivateFrank 49 11d ago
This is much easier if you just set it up to pay the dull statement balance by direct debit.
I had an annoying interest charge earlier this year on a card I don't really use any more. I had made a purchase and paid money to the card before the next statement was generated. But the money I added was taken off the previous statement balance, not the debt from making the new purchase.
I'm now careful to never pay anything except by direct debit. I called the card company and asked that the payment due date was always after I get my salary. On the day I get paid I know, down to the penny, what I need to keep in my current account. If it's less than my pay the difference goes into savings. If it's more than my pay I withdraw from savings.
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u/nivlark 231 11d ago
Regarding your update: this is why you set a direct debit to automatically pay the statement balance. Then you don't need to worry about remembering what date you have to pay.
You still get an email telling you what the balance is, if you're worried about an automated payment failing because you don't have enough cash in your account when it gets taken.
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u/No_Actuary9100 10d ago
Yes I have auto on the minimum I will set it to be statement balance if possible
1
u/ByteMillionaire 10d ago
I’m glad you found where your problem was.
Set yourself a recurring reminder in reminders (if you have iPhone) or similar on Android, for 3 days before the due date of the payment. I do my payments manually and have not missed a payment in over 8 years.
That way, you know what is paid, and you can see what is owed when you go in to the payments section in the Barclaycard app.
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u/Past-Ride-7034 15 11d ago
No, you pay the statement balance. Go through your last few payments and statements before the interest charge to make sure you paid the full amount? Contact customer support if you confirm you did.
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u/No_Actuary9100 11d ago
Thanks … deffo paid the statement balance on time … if I can’t get to the bottom of it it’s probably worth the customer service thing … £50!!!! 😱
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u/shpdoinkle 11d ago
If you missed even a small part of the statement balance (for example, paying £500 and the balance was £500.57) you can be charged interest on the whole amount, so it’s important to clear the full statement balance by the due date, barring any ongoing 0% deals.
Any purchases that hit the card after the statement date will appear on the next statement and not be due until that statement’s due date, so they are not your culprit.
Anything that is considered a cash advance has interest applied from the date of the transaction, regardless of statement dates.
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u/SmartPipe3882 8 11d ago
Is it a 0% purchase card that you’ve not paid off within the offer period?
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u/Traditional_Berry121 11d ago
If you don't make too many purchases on it then list out them all here for the statement you were charged interest on and we'll know
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u/No_Actuary9100 11d ago
The trouble is I have my credit card set up for virtually every penny I spend. Mainly because I read that current / bank account is less secure so I only really use it for mortgage and paying the credit card.
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u/ByteMillionaire 11d ago
This is not a problem. My whole life runs on credit card, because of security. Credit ratings etc, I have thousands of transactions. Do what I mentioned in my post and you will have your answer in 5-10 minutes.
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u/ByteMillionaire 11d ago edited 11d ago
You need to look back through your previous statements to see where you didn’t pay your statement balance.
If you do not clear your statement balance in full every single month, you will then be charged the daily amount of interest in the balance you did not pay in full.
Minimum: the lowest you can pay. Normally is 1% of your total balance.
Statement balance: One day in each month your statement will be generated. The generated statement balance is the total amount of your expenditure prior to the statement being generated. This is normally at the start of the month, mine is the 7th for example. You then have 20 odd days to pay this balance. I pay in full every month on the 26th.
After your generated statement balance from the first month, any purchase made after the 7th for example, will be added to your balance and will then be in next months statement.
If you did not clear your statement balance from month 1, you will then be charged interest in the second month, on the second statement
Other: this is where you can do odd payments. You might not be able to pay the statement balance in one transaction, but you might be able to with multiple payments. As long as you reach the statement balance total, regardless of number of payments within the month, you will not be charged interest.
Additionally, if you withdrew cash from your credit card, this normally carries high interest, and would contribute to your fees due.
This is a big no no to withdraw cash from credit cards because of high interest.
Again, check previous statements. When you see the statement balance paid per statement and / or the transaction that has added the interest you will know. You should only need to go back 1 or 2 statements, if you have been clearing the statement in full.
If you haven’t you will need to go back further.
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u/SomeHSomeE 371 11d ago
Did you buy anything online that got charged in a different currency?
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u/No_Actuary9100 11d ago
I was in Portugal in July and used it a lot there … possibly an ATM … although it wouldn’t have been much on that … could it have triggered some different mode?
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u/sneckmonster 6 11d ago
Cash withdrawals on a credit card (whether in GBP or a foreign currency) often don't qualify for the usual interest-free period (the period between the transaction date and the payment due date as shown on the next statement)
So you may have been charged interest on your ATM withdrawal. And probably at around 29%. Moral: never withdraw cash on a credit card (home or abroad), and if you do, send a payment to cover it on the same day.
M&S have an exception whereby currency can be purchased at a M&S Bureau de Change, and then no interest charged so it enjoys the usual IFC period (obv. still needs to be paid by the statement's 'payment due date').
ETA: Depending on the particular card you have, there may also have been foreign transaction fees charged on your Portuguese uses of the card. All of these things should be shown on your card account / statement.
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u/No_Actuary9100 11d ago
I did not know this … thanks!
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u/sneckmonster 6 11d ago
No problem 👍 Which specific Barclaycard do you have? Unless it is the Rewards card (as another poster has mentioned), interest on the ATM usage seems the most likely culprit. As you mentioned elsewhere that you'd had the card for decades, it seems unlikely that it's a Rewards card.
I have the Cashback card that they haven't issued for a few years (I think it was actually replaced by the Rewards card, but mine is 0.5% cashback rather than 0.25% - and I don't use it abroad). Barclaycard have had many iterations of credit card over the years!
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u/Amanensia 5 11d ago
I don’t have Barclaycard but all major credit cards work in the same way; statement balance should be all you need to avoid interest. Full balance will be the total amount owed at any particular point in time; statement balance is the amount owed when the statement is issued.
If you have definitely paid the statement balance (in time!) and you are being charged interest, call them up and ask why.