Confused on my Credit Card Interest Charge

T

thespecialon

Registered User
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211
Hi All,

I have always paid off my credit card in full so have never been charged interest before.
Due to certain circumstances I have had to use my CC a bit more than usual last 2 months - I am a little confused on how much Interest I have been charged -

Basically my Statement Closing Balance for May was €1348.05 I received statement around 13th of May
On the 29th of May I paid €1050 of this back(Had until 9th of June to pay)
Therefore I didnt pay back around - €298

Just looking at my online banking and my June Statement- has a closing balance of €1,823.62.It shows a charge for Interest of €34.94.

Surely €34.94 is a lot of interest to pay on €298?? Or am I missing something obvious here??I have a Standard UB credit Card which is supposed to have a rate of - 16.5% APR. I did go over my limit for which they chaged me a fee of €8.50 whcih is fair enough.my limit is around the €1500 mark I think.

Can anyone shed some light on this for me before I go ringing them??I am confused at this stage?

Thanks,

T
 
AFAIK the interest is always charged on the full balance, in this case the €1348.05 -regardless of the amount paid off. If you don't pay the full amount you'll be charged interest on the full amount.
 
If you don't pay the whole lot by the due date you are charged interest on the whole sum that was due - therefore in your case you were charged interest on the full €1,348
 
Last edited:
thanks for the quick replies guys.I though I was well up on my financials aswell but didnt see that one coming..Ill have to get it paid ASAP so...
Thanks,

T.
 
You'll be charged interest on the full amount inccluding later balances until you're within terms again so well worth your while doing so or you'll end up with interest on interest!
 
Credit card companies often specify different ways of calculating their interest charges. Unfortunately there's no industry standard at the moment although I think it would be a good idea.
Credit card companies are always cooking up new deals to position their products above competitors, but be sure that a great looking cheap deal may not all it appears to be when you read deep into the terms and conditions. With someone like MBNA Ireland, when you [broken link removed], there are detailed and usable online help pages to assist you in understanding how you will be charged.
Generally these terms are fair, just don't expect to get something for nothing and if you're really unhappy you can always switch providers. You may not gain much from that though as most credit card providers are similar in the way they charge interest. The best option is to fully understand a deal before you sign up and pick one that suits your own circumstances - use it to save money if you can then go elsewhere once you've seen the benefits out.
 
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