I normally would never use my credit card for cash advances however I was stuck a few months back and took out €60. I was aware that cash advances charge higher interest so a few days later I transferred €60 from my current account to the credit card. I assumed I would only pay cash advance interest for those few days. I have since found out that I am still being charged cash advance interest several months later.
I rang the bank (Ulster Bank) and was told that any payment I make is prioritised towards the lower interest bearing balance first (i.e from normal purchases).
I said I was under the impression that payments had to clear the higher interest loaded balance first.
They told me that this is the case for Sterling customers as there was a 'directive' brought in a while back but this is not the case for Euro customers so until I clear the full 100% of the balance that €60 will still remain attracting the higher cash advance interest.
My questions are:
1. Is it not the case that payments must be allocated against the higher interest bearing portion of the balance first?
2. If not, why has this directive been implemented in the UK but not in Ireland? Should the financial regulator not have brought this in to help people clear their debts?
I rang the bank (Ulster Bank) and was told that any payment I make is prioritised towards the lower interest bearing balance first (i.e from normal purchases).
I said I was under the impression that payments had to clear the higher interest loaded balance first.
They told me that this is the case for Sterling customers as there was a 'directive' brought in a while back but this is not the case for Euro customers so until I clear the full 100% of the balance that €60 will still remain attracting the higher cash advance interest.
My questions are:
1. Is it not the case that payments must be allocated against the higher interest bearing portion of the balance first?
2. If not, why has this directive been implemented in the UK but not in Ireland? Should the financial regulator not have brought this in to help people clear their debts?