FNB Gold Credit Card and Interest

[mr_norris]

I was sifting through my credit card statement the other day, and noticed a R200 interest charge billed on 2 November. I was very puzzled about this, as my routine is spend only on my CC through the month, then pay it off the night before I get paid, and repeat. The charge isn't something that would cripple the Norris Economy, but it bugged me. So I complained.

This morning, a dude from FNB calls and explains to me that it was because I was warned to pay by the 27th of the month, yet I paid on the 29th. Now in all fairness, I did only pay on the 29th of October, as I got very confused with how slow FNB are to update things over the weekend. With my salary coming in, my OD, and some recent shopping, I wasn't sure what money was mine and what was FNB's. So I waited for everything to settle, and then paid.

I then asked how I could be billed R200 for being two days late, and then very quickly he said as a gesture of goodwill, they'd refund me. I thanked him, and left it at that. But I am left rather confused. FNB's website mention that the credit card has up to 55 days interest free (I gather "up to" is the important thing here, but I have no clue to see if this applies to me - I thought it was the standard for everyone). According to my maths, I shouldn't have been hit with an interest payment at all. Looking back at my history, this happened:

25 Aug: CC Paid off
25 Sept: CC Paid off
29 Oct: CC Paid off

There are not 55 days between the 25th of Sept and the 29th of Oct. I thought that maybe it might be because of uncleared items that only cleared after I paid (so they would be unpaid), but I do account for uncleared transactions before settling. Assuming I did a bit of fail maths, I didn't spend enough to warrant R200 interest on it.

In my mind, I was either duped and they made a mistake which they couldn't or wouldn't admit, or that 55 days interest free line is BS. If I am wrong, someone please enlighten me. I don't get it at all.

tl;dr; check your credit card statement for random interest charges. I'll be doing it on a more regular basis from now on.

 

[Goosfrabba]

Credit cards can be tricky and rather difficult to understand at times. I've seen someone get charged a little over R700 because they short paid the minimum due amount by around R8.

It wouldn't be interest but rather a finance charge of some sort that is incurred unless the payment due is received on time.

I stand to be corrected, though that's how I understand it

 

[mr_norris]

Credit cards can be tricky and rather difficult to understand at times. I've seen someone get charged a little over R700 because they short paid the minimum due amount by around R8.

It wouldn't be interest but rather a finance charge of some sort that is incurred unless the payment due is received on time.

I stand to be corrected, though that's how I understand it

The line in my statement did say "interest", but given what's happened, I suppose anything is possible!

 

[saor]

Had the same thing two months ago.

I use my credit card during the month then manually pay the balance a few days before month end (transfer from cheque to credit account). This time however, the transfer didn't complete in time (not sure how this works - would think it's instant if transferring between my own accounts) and I was billed the R200. Got on the phone and this stuff gets so convoluted they way they structure and explain it I eventually got tired of trying to get a clear answer and left it and have just been paying the balance a few more days in advance of month end.

 

[Tomtomtom]

This happened to me once. Also got it dropped. Managed to avoid it since, mostly by setting up auto-payment. ("Full amount" is the option you want.)

As I understand it, interest accrues on everything from the day you transact. If you don't pay the amount due on your statement by the due date, you are exposed to all of it -- even though it's not quoted on your statement or anywhere else. If you do pay it, you aren't.

The reason it's up to 55 days is because a statement cycle is one month, but the due date is about 25 days after the end of each cycle. If your statement is dated 6 Nov, it will include transactions from 6 Oct. But the due date may be 1 Dec. From 6 Oct to 1 Dec is 55 days.

So technically it's only those transactions you do on the first day of your statement cycle that are interest-free for the full 55 days. The average interest-free period is about 40 days.

I think lots of people "zero" their card by paying the full balance, rather than the statement amount due. If you do this your average interest-free period is more like 15 days.