Vanquis - Cash charges

[Penfold92]

Hi guys,

 

I have had a Vanquis card for about a year now and generally pay the balance off every month. Recently I have noticed that they are charging me cash interest every month. When I called them up they said that even though I have paid the balances every month I have new transactions added and unless there is no balance for two months in a row the interst will continue...

 

Can someone please tell me how this is allowed and how this is surely an unfair term? In fact I cannot even find this in their terms and conditions...

 

Any advice would be appreciated,

 

Penfold

[yozdagger]

It has to do with the way they allocate payments - effectively you have multiple balances - balance transfer one, fees one, purchases one, cash one etc..

 

When your payment is made they use it to pay off the balances that incur the least interest (i.e balance transfers or purchases or fees - even if the transactions are made after the statement date) and after all this only if there is any left over will it be finally applied to your cash balance.

 

Most credit card companies do a similar thing - it just ensures they squeeze the most interest out of you. It's detailed on the back of your Vanquis statement under 'Allocation of payments' - I dont have the T&C's to hand but I assume its also in there.

 

I got caught by the same thing - not anymore!

 

I heard the review into the credit industry will look at this practice.

[Penfold92]

Thanks for that, but the fact I was not told on sign up and it is not in their terms is surely "unfair"? Also what review of credit industry are you referring to?

 

Thanks,

 

Penfold