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Thread ID: 60305 2005-07-28 03:51:00 Working Out Credit Card Interest vista (8617) PC World Chat
Post ID Timestamp Content User
376337 2005-07-28 03:51:00 Can someone advise how interest rate charging happens on Credit Card

I have ANZ Quantas Visa which has interest rate of 19.95% per annum which offers 44 days interest Free. The account cycle date is 5th of each month.

Now Assuming my opening balance on credit card on July 5th was $0 and say if i make a purchase of $500 on 7th July and anothe purchase of $800 on 15th July. When my next statement comes out on 05th August which shows i have a balance of $1300 outstanding with minimum payable due $26 by 17th August (2% min payment req and July 5th - 17th August = 44days).

Now can someone tell me if make that minimum payment of $26 and buy nothing until the next statement comes out on 05th Sept, what will the interest charge be?

I have checked the banks website and theres no little calculators to work out interest on charges and their calculation on the statement is not clear. Also calling them they dont sound too clear on explaining how it works out.

Now i guess i can workout by pro rata method. but also if some can explain how it works while you are paying off more then the min due. Do they charge interest on outstanding balance or still work out interest on each purchase.

Thanks for any help. 		vista (8617)
376338 2005-07-28 05:10:00 I don't know but the Westpac site is helpful.

www.westpac.co.nz

They say as follows:

When is interest charged?

In general, interest will charge for two reasons on either your Westpac standard or gold credit card account. These are:
if there have been any cash advances - interest will accrue daily at our current credit card interest rate from the date of each advance until full repayment.
if your statement balance is not paid in full by its due date. If you do not pay your statement's closing balance in full by its due date, interest will be accrued daily on your opening balance, and any new purchases from the date each transaction is processed to your account. Only once full payment has been received, will the interest stop accruing on purchases. 		Winston001 (3612)
376339 2005-07-28 05:20:00 I would look at some of the calculator at sorted.org.nz (http://www.sorted.org.nz). Jeremy (1197)
376340 2005-07-28 08:41:00 Thanks guys

But sorted does not have any credit card interest rate calculator. I had a look there already. And what Westpac says also says n ANZ's statement pretty much but if someone can give claculations details will be appreciated.
Any math lovers there... 		vista (8617)
376341 2005-07-29 06:51:00 Can someone advise how interest rate charging happens on Credit Card

I have ANZ Quantas Visa which has interest rate of 19.95% per annum which offers 44 days interest Free. The account cycle date is 5th of each month.

Now Assuming my opening balance on credit card on July 5th was $0 and say if i make a purchase of $500 on 7th July and anothe purchase of $800 on 15th July. When my next statement comes out on 05th August which shows i have a balance of $1300 outstanding with minimum payable due $26 by 17th August (2% min payment req and July 5th - 17th August = 44days).

Now can someone tell me if make that minimum payment of $26 and buy nothing until the next statement comes out on 05th Sept, what will the interest charge be?

This should be clearly (read: plain english) explained in their fees, charges and interest schedules. But as I remember there are two way: one fairly plain, and the other plainly evil.

1. The plain way:
$1300 - $26 = $1274.00 outstanding balance at end of credit free period.
$1274 x 19.95% (very high!) = $254.16 per annum.
$254.16 / 12 = $21.18 per month.

2. The evil way:
Outstanding balance = $1274.00, or it could be even $1. But they still calculate the interest from the original (not completely paid-off) balance, i.e., $1300.
So $1300 x 19.95% (very high!) = $259.35 per annum,
or $21.61 per month.

Go to a branch (is ANZ still languishing at the bottom of the branch service standards?) and get someone to talk to you about it.

Have a look at this (www.guardian.co.uk). Awful. 		vinref (6194)
376342 2005-07-29 10:52:00 Remember that they'll usually take the highest balance of the month to calculate interest on. Instead of calculating interest daily. Jeremy (1197)
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