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Credit Cards

What is residual interest?

If you have a balance on your account you'll be charged interest on the transaction from the date you make it until the day you pay it off. If you pay off some of your account before your due date, you will reduce the balance, but you'll still pay interest on the remaining balance.

 

If you paid your balance off in full and have still been charged interest, this is known as residual interest. We charge interest daily, so even if you paid your balance in full you may still see interest on your next statement. That's to cover any previous outstanding balance from the period between the credit card bill being sent and when the payment is received.

 

The sooner you make your payment after your statement is produced, the less the interest will be, unless you pay in full and on time each month.

Comments

I cannot understand the interest amount I have paid. It just says 1.456% with a total of £30.44.

can someone explain to me how this figure is reached? 

@ackers19 Interest is calculated based on the average daily balance of your account starting with the earliest transaction on the previous statement. The rate of 1.456% will be your monthly rate, which is your Annual Percentage Rate divided over the year. I'm afraid we can't go into the specifics of balances via this channel but if you feel the interest has been incorrectly applied, please give us a call on 0345 300 4278 (24/7) and we'll look into this for you.

so what is the daily interest rate?


@ysabell wrote:

If you have a balance on your account you'll be charged interest on the transaction from the date you make it until the day you pay it off. If you pay off some of your account before your due date, you will reduce the balance, but you'll still pay interest on the remaining balance.

 

If you paid your balance off in full and have still been charged interest, this is known as residual interest. We charge interest daily, so even if you paid your balance in full you may still see interest on your next statement. That's to cover any previous outstanding balance from the period between the credit card bill being sent and when the payment is received.

 

The sooner you make your payment after your statement is produced, the less the interest will be, unless you pay in full and on time each month.


so what is the daily interest rate?

The daily rate would be whatever your applicable APR is divided by 365. As mentioned, we can't discuss or confirm your rates here, particularly in a public thread. If your require more detailed information, please contact us on the number above.