Cash advance charges on credit card
I took a cash advance from a ATM using my credit card on a visit abroad. It was in Nov 2013. Bank charged it in December bill along with the interest and other fees. I paid the complete bill amount on time. However they again charged an interest on my Jan 2014 bill also. When I called them, I was told that, in case of cash withdrawal paying the full bill amount is not sufficient. I paid the bill amount in full and I was using the card for other purchases as usual. They said, since I used the card after they send the bill, that will remain as an outstanding and they will charge interest for that. That means, the bank will continue to charge me forever even though I pay the full billed amount and continue to use the card. They said the way around is not to use the card for a month, get the bill and pay the full amount. Is this correct?. How can they charge me even after I settled the cash with drawn along withe the interest and other charges
Asked in Business Law from Bangalore, Karnataka
it is necessary to go through agreement signed by you with bank for use of credit card . generally in case of cash withdrawals on credit card bank charges you 3%per month ie 36%pa . on bill being raised you can pay the entire outstanding with interest . it appears you have done so . if you had not paid full bill on due date and continued to use card for other purchases bank would be justified in charging you interest in month of January too
you can request bank to point out specific clause in your agreement which authorities bank to levy interest on further purchases made after raising of bill when full payment has been made on due date . you can also lodge complaint with bank Om budsman if you are not satisfied with the response . another option is to move consumer forum for deficiency in service .
Issue legal notice to the Credit Card company and ask for explanation for excessive/repeated interest charge.