Aib credit card interest change letter
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losttheplot
Registered User
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I got it too. This is what I think it means, but I could be wrong.
Currently, if you receive your statement with say a balance of 1000 and you pay 500 by the due date, you're charged interest on the 1000. The new balance carries forward. If you clear you're next monthly statement you pay no further interest on the 500. I think under the new system, they would charge interest on the 500 euro.
At least that's what I think they were saying, the letter is confusing.
Currently, if you receive your statement with say a balance of 1000 and you pay 500 by the due date, you're charged interest on the 1000. The new balance carries forward. If you clear you're next monthly statement you pay no further interest on the 500. I think under the new system, they would charge interest on the 500 euro.
At least that's what I think they were saying, the letter is confusing.
Extract from the letter:
From 15th January 2011, if you pay the full balance on your current statement but had not paid the full balance on your previous statement, you will be liable for interest on the amount not paid on the previous statement. Interest is calculated from the date of the current statement until the date full payment is credited to the account. This interest amount will appear on your next statement.
This change will NOT impact you if:
You pay your balance in full every month, or
You carry over a balance every month
To be honest I find this very ambiguous and confusing.
From 15th January 2011, if you pay the full balance on your current statement but had not paid the full balance on your previous statement, you will be liable for interest on the amount not paid on the previous statement. Interest is calculated from the date of the current statement until the date full payment is credited to the account. This interest amount will appear on your next statement.
This change will NOT impact you if:
You pay your balance in full every month, or
You carry over a balance every month
To be honest I find this very ambiguous and confusing.
losttheplot
Registered User
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- 625
The last bit I found very confusing too.
I think if you don't clear your balance every month you do end up paying more - but can't figure out exactly how, clear as mud.
I think if you don't clear your balance every month you do end up paying more - but can't figure out exactly how, clear as mud.
taxedparent
Registered User
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hi all I just spoke with AIB about this, the way they explained it on the phone is that if you in the past made a payment on the due date, the interest acrued for the time taken to clear your payment would be abosorbed by them. e.g payment might take 2-3 days to clear onto your account. That 2-3 days interest wouldn't be charged to you.
Under the new system the interest isn't abosrbed and its tacked onto your bill. The second piece is that if you do not pay by the due date you will now incurr a late payment charge
This all assumes you have outstanding balance and you make a payment that doesn't clear the balance. However the late payment fee will apply in this situation even if you do clear the payment but fail to make it by due date
I was recommended to make sure my payment was submitted at least 4 business days prior to due date to avoid late charge.
Unfortunately i get paid every 4 weeks so my pay date changes from month to month. Im going to have to really watch this or I will get charged the extra 7 euro. I did ask could they make any changes so that my due date would fall 5 business days after my pay date each month but they advised that they never came across a situation where a customers pay date changed from month to month.
Im going to look around now at other companies to see if they can accomodate my situation. If they can I will move cc, savings and bank account.
Under the new system the interest isn't abosrbed and its tacked onto your bill. The second piece is that if you do not pay by the due date you will now incurr a late payment charge
This all assumes you have outstanding balance and you make a payment that doesn't clear the balance. However the late payment fee will apply in this situation even if you do clear the payment but fail to make it by due date
I was recommended to make sure my payment was submitted at least 4 business days prior to due date to avoid late charge.
Unfortunately i get paid every 4 weeks so my pay date changes from month to month. Im going to have to really watch this or I will get charged the extra 7 euro. I did ask could they make any changes so that my due date would fall 5 business days after my pay date each month but they advised that they never came across a situation where a customers pay date changed from month to month.
Im going to look around now at other companies to see if they can accomodate my situation. If they can I will move cc, savings and bank account.
Last edited:
C
chests
Guest
An article was written about the AIB credit card about two weeks in the sunday times business section.
I found another article on the internet from taxation.ie
AIB credit card holders can expect to pay an extra month’s interest on unpaid balances, even if they are only a few days late, according to The Sunday Times. The new charges, which take effect in January, mean customers will have to pay at least two months’ interest charges if they fail to clear their balances in full or miss payment deadlines. Niall Brady, the newspaper’s personal finance editor, notes the new charges will come into effect just as card holders pay Christmas bills.
Under current rules, for example, anyone spending €2,000 a month on their card must pay in full by November to avoid interest. If someone pays only €1,000, they will incur interest on the full €2,000 – about €40. No additional interest will be charged if they clear the €1,040 balance outstanding by December’s payment deadline.
It’s a whole new ball game from January.
I found another article on the internet from taxation.ie
AIB credit card holders can expect to pay an extra month’s interest on unpaid balances, even if they are only a few days late, according to The Sunday Times. The new charges, which take effect in January, mean customers will have to pay at least two months’ interest charges if they fail to clear their balances in full or miss payment deadlines. Niall Brady, the newspaper’s personal finance editor, notes the new charges will come into effect just as card holders pay Christmas bills.
Under current rules, for example, anyone spending €2,000 a month on their card must pay in full by November to avoid interest. If someone pays only €1,000, they will incur interest on the full €2,000 – about €40. No additional interest will be charged if they clear the €1,040 balance outstanding by December’s payment deadline.
It’s a whole new ball game from January.
P
pumpkinhead
Guest
Its definitely an increase in charges as far as I can see. If you have a large balance which you can't pay off in one go, and you want to pay some off each month, you will get an extra month's interest on the last payment under the new regime.
I was just wondering, is there any comeback on this other than to move to a different credit card provider? Can AIB actually do this without our agreeing to it? Guess I should have read the small print when I got the card...
I was just wondering, is there any comeback on this other than to move to a different credit card provider? Can AIB actually do this without our agreeing to it? Guess I should have read the small print when I got the card...