info on credit card

Eimee90

Hi guys, im finally financially in a position of getting a credit card with BOI and was just wondering how it works. Sorry now if i seem silly asking, just havent used one before.

Am i right in saying you pay off the items bought in a certain amount of time. And there's interest on that item.

Is there a card fee like debit cards.

coylemj

There is an annual Govt. charge of €30 which BoI currently slaps on my April bill each year. If you're getting a bog standard card, there is no other fixed charge.

There is no interest if you pay off the bill in full every month and don't use the card for cash (ATM) withdrawals.

There will be a cut-off date each month for billing, you will get your bill a couple of days later and you will have about three weeks after that to pay the minimum amount (shown on the bill) but you should pay the whole balance by the due date in which case you will pay no interest.

If you don't pay the whole balance, what you do pay will be applied first to any balance carried over from the previous month, then to the purchases shown on the most recent bill in the order in which you bought those items. Whatever balance remains will then attract interest which will be applied to recent purchases from the date of the transaction. The outstanding balance can quickly get out of control because the interest on credit cards is exorbitant so you should never use a credit card for short-term credit because it's simply digging a hole from which escape is very difficult.

This means that if you buy something on the day after the billing cut-off, you won't see it on the bill for a month and you'll have about three more weeks to pay for it so you can get up to seven weeks free credit. But, if you don't pay the bill, they will levy interest on that amount for the full seven weeks.

Atlantic Dawn

If you don't need the credit element of the credit card you might be better sticking to the debit card. Main benefits of the credit card is you have 50 or so days to pay off the amount with no interest payable and you also can use it for things like car rental which is not always possible on a debit card.

Mrs OBumble

Many banks will let you set up to automatically off the entire bill on the due date.

Very handy if you want to pay no interest and are certain you'll always have sufficient funds to cover it.