Credit cards explained

[TurkeyMan]

An update for those interested:

Just got off the phone with FNB. They explained the 55 day interest free concept, which was exactly what 3WA mentioned in his link above.

This is why I was charged interest:

• I paid off the full balance on the 25th of June
• My statement date ran until the 28th of June
• In these three days, I spent about R2 000, so this amount was carried over to July and needed to be paid on the 25th of July.
• I then again paid off the full amount of what I spent in July, and unknowingly the amount from the end of June, on the last day of July.
• This R2 000 was a few days over due so I paid interest on that amount.

Moral of the story, check your statement for your payment cycles and just pay the full amount off by the due date mentioned, not the end of the month.

Lastly, the FNB agent told me that if you buy fuel and they "put it through as a fuel transaction", it will always immediately incur interest and the 55 day rule will not apply. Not sure who's right here since a number of posters here said they pay for fuel with their credit card and don't pay interest.

Cheers, and happy saving all.

 

[danny0]

I've been a client of FNB for some time now, but in June I opened a credit card to maximise my eBucks. The changes I made took me from about R180 in eBucks a month to R800 a month so I've been pretty happy with it.

However, in my latest statement for July I see that I've been charged interest. As I understand it, this shouldn't be possible because of the following reasons... I appreciate the help.

I've also only taken out a CC with FNB since April19 for this same reason.
I have not paid a cent interest to date - I pay the full amount owing on the exact date it is due.

Use your CC for everything, except withdrawing cash and EFT's.
Paying for fuel with your CC does not attract interest (only a Petro card will). On the contrary there's a major benefit in paying for fuel with your CC (R4.00 back per litre if you fill at Engen).

Tip: do not withdraw cash at an ATM, withdraw at a Checkers till point instead (earns you ebucks level points) -with your cheque card, not CC.

 

[^^vampire^^]

Using credit cards for points etc had always been too much work in my eyes.

Anyway, you can still use CC for points etc but always pay with CC and immediately transfer money from saving to pay off the balance. This is also useful as if there is fraud or your stuff doesn't arrive you can lodge a complaint and get the money back with a CC, where this is far more difficult if not impossible with a debit card.

 

[danny0]

Using credit cards for points etc had always been too much work in my eyes.

Anyway, you can still use CC for points etc but always pay with CC and immediately transfer money from saving to pay off the balance. This is also useful as if there is fraud or your stuff doesn't arrive you can lodge a complaint and get the money back with a CC, where this is far more difficult if not impossible with a debit card.

Hows it too much work?
Instead of swiping a chq card you swipe a CC (same effort)
The only added step is transferring money from your savings/chq acc to your CC account once a month (and this earns you R800-R900 p/m at least. Plus now if your spend is 100% on your CC you even earn a R100 Kuai voucher every month.

 

[John Tempus]

Hows it too much work?
Instead of swiping a chq card you swipe a CC (same effort)
The only added step is transferring money from your savings/chq acc to your CC account once a month (and this earns you R800-R900 p/m at least. Plus now if your spend is 100% on your CC you even earn a R100 Kuai voucher every month.

I think he means that if you are earning R900 worth in points for cash on CC swiping then you are earning enough to not be bothered with the measily points for cash you earned. Ive never used these systems so I am curious. In your example of R900 a month , how much do you need to swipe to get roughly that amount in cash back ? R50k, R100k ?

 

[Gtx Gaming]

Lastly, the FNB agent told me that if you buy fuel and they "put it through as a fuel transaction", it will always immediately incur interest and the 55 day rule will not apply

This rule never gets enforced, it is legacy rule, they still have to tell you that it does.

 

[RedViking]

I am with Absa (Cough cough) and also buy on Credit card like OP and have NEVER paid interest. I pay money into the credit card once a month or sometimes a little bit later than a month, not on a specific date, to bring the value to positive. During that time it goes into minus. Only time I pay a fee is if I use the Credit Card to draw cash at ATM and a small monthly card fee.

Wife (FNB) got Credit card for Ebucks. She gets an sms during the month that she must put X amount before it will start charging interest on X date.

 

[backstreetboy]

I think he means that if you are earning R900 worth in points for cash on CC swiping then you are earning enough to not be bothered with the measily points for cash you earned. Ive never used these systems so I am curious. In your example of R900 a month , how much do you need to swipe to get roughly that amount in cash back ? R50k, R100k ?

https://www.ebucks.com/web/calculator/rewardsCalculatorAction.do

 

[Sinbad]

Thank you for your replies everyone. I appreciate the help. I'll also call FNB to hear their side of things, just wanted this context before I do.

The last question I have is about FNB's website. They say that "failure to clear the full balance will mean you lose the 55 interest free period for your next and current period".

I have fully paid the card off now. Like I said I only use it because of eBucks. But based on the below, does that mean I will be immediately charged interest on any purchases I make in August because I didn't pay before the due date (25 July)? Regardless of the fact that I've fully paid it off?

Lesson learned. Pay off the card before the 25th, and not the last day of the month...

View attachment 690651

Tell them to set up an automatic payment on due date for full amount. Then never worry again.

 

[3WA]

I think he means that if you are earning R900 worth in points for cash on CC swiping then you are earning enough to not be bothered with the measily points for cash you earned. Ive never used these systems so I am curious. In your example of R900 a month , how much do you need to swipe to get roughly that amount in cash back ? R50k, R100k ?

I spend about R10k a month on my card to get back R1k in eBucks. Others invest more effort and earn much more. As for me, I have a good balance between effort and getting back a reasonable amount of money. The only effort I have to go to is paying for DSTV via Snapscan and paying my rates at Checkers during a grocery run - ten minutes a month.

 

[KleinBoontjie]

Had a few confrontations with FNB, about the same thing. I only use the positive balance on my credit card. There is one or two times I might go into a small negative, then I immediately transfer money. Yet, interest was deducted. I really don't like how FNB do business.
They still owe me money for automatically upgrading me to Premier, that I didn't even asked for.

 

[Speedster]

I spend about R10k a month on my card to get back R1k in eBucks. Others invest more effort and earn much more. As for me, I have a good balance between effort and getting back a reasonable amount of money. The only effort I have to go to is paying for DSTV via Snapscan and paying my rates at Checkers during a grocery run - ten minutes a month.

Yup. Was about to say that correct usage of credit card should get you between 8-10% back in ebucks, probably more now that the fuel reward has doubled

 

[tRoN]

Such a long thread for a simple answer to your question.

Pay the full amount due before the due date.

It was your mistake paying at month end

 

[C4Cat]

An update for those interested:

Just got off the phone with FNB. They explained the 55 day interest free concept, which was exactly what 3WA mentioned in his link above.

This is why I was charged interest:

• I paid off the full balance on the 25th of June
• My statement date ran until the 28th of June
• In these three days, I spent about R2 000, so this amount was carried over to July and needed to be paid on the 25th of July.
• I then again paid off the full amount of what I spent in July, and unknowingly the amount from the end of June, on the last day of July.
• This R2 000 was a few days over due so I paid interest on that amount.

Moral of the story, check your statement for your payment cycles and just pay the full amount off by the due date mentioned, not the end of the month.

Lastly, the FNB agent told me that if you buy fuel and they "put it through as a fuel transaction", it will always immediately incur interest and the 55 day rule will not apply. Not sure who's right here since a number of posters here said they pay for fuel with their credit card and don't pay interest.

Cheers, and happy saving all.

I don't understand where the 55 days comes into it?

 

[diapason]

You have UP TO 55 days interest free from date of purchase so long as the FULL BALANCE is paid by due date. And, there is no need to guess the date as some seem to be doing. The monthly statement gives the information.

 

[Speedster]

I don't understand where the 55 days comes into it?

55 days is from the first day of a statement cycle to the payment date. Each day into the payment cycle is one day closer to payment date and hence one day less interest free

 

[Speedster]

You have UP TO 55 days interest free from date of purchase so long as the FULL BALANCE is paid by due date. And, there is no need to guess the date as some seem to be doing. The monthly statement gives the information.

I guess it is important to note that paying the full statement balance will still leave the card with a negative balance

 

[HeftyCrab]

Ok just checked the app and I found the option there. When viewing your accounts, click the arrow next to your credit card and select "Maintain Auto Payment".
Looks like they have also reduced down to 2 options for minimum amount and full amount(statement).

+1 I use the full auto payment myself, and only spend on my CC what I know I can pay off at the end of the the month. I essentially just use it to improve my credit rating.

 

[danny0]

I think he means that if you are earning R900 worth in points for cash on CC swiping then you are earning enough to not be bothered with the measily points for cash you earned. Ive never used these systems so I am curious. In your example of R900 a month , how much do you need to swipe to get roughly that amount in cash back ? R50k, R100k ?

Nah, around R15k or so.
Note that no special effort is made or any unnecessary spend. It is what I would have swiped/spent on my debit card anyway.

Also, its not just earning +/- R1k per month.
There is the added benefit of extra savings (upto 40%off) items in the ebucks store... a good example, I am contemplating buying a skyworth tv box for for the kids toy room for R437.40 from the ebucks store as opposed to R999 from Makro.