US Dollars purchase...

Actually - no, you can't do that. Just checked and that breaches their conditions of use...

I find these days that I use very little cash when I'm abroad. I pay for most things with my card and only use cash for, say, drinks in a cafe.

Yes indeed. I asked them about that at the outset - and the official party line is that if you pay money in which you don't currently owe in order to create a credit balance, they'll immediately refund to it to the account it came from. I haven't tried, to see whether this

*actually* happens.

But what if you arrange for your account to be credited with an amount equal to the value of the cash withdrawal transaction as soon as it has been debited to your account? They can't claim that you don't owe them money, and that should reduce any interest due to virtually nothing.

Chris

Not necessarily because if you also have outstanding purchases, depending on the precise rules they follow[1], they may offset your cash injection against the purchases rather than against the cash withdrawal. To avoid that, you've have to inject enough cash to pay off your entire debt.

[1] CC Co's T&Cs stipulate the order in which they apply any repayments you make. Some have recently changed this so that repayments first offset the part of a the debt which incurs the greatest charge. I can't remember whether Halifax has done this - if so, your scheme should work.

That's true, but I thought we were considering a situation where there was no prior outstanding balance on the card. I was proposing this as a way of avoiding the problem you pointed out with them returning money when it would have created a credit balance.

Chris

You are, of course, correct - but I guess I was widening it a bit to cover 'real world' situations. When abroad, you're likely to use the card for *both* cash withdrawals *and* purchases - unless you have a separate card for each of these.

I've had a credit balance many times, and have never had funds returned.

Usually this was small: overpaying so that I also covered any accruing interest since the statement date, or simply couldn't remember the exact amount.

But one time it was about £100, which *was* to do with a cash withdrawal. This card had recently had a DD set up, but that wouldn't take place until the end of the month! Didn't want to wait that long so paid the £100 immediately. However the DD then took a *further* £100 at the end of the month, ignoring the actual balance, so that I was £100 (plus small amount of interest) in credit.

(Another argument against Direct Debit..)

No problem, and it's definitely a good idea to take at least two cards with you when you travel anyway. Apart from the possibility of loss or theft, it's not uncommon for a card to be temporarily suspended as a result of the card company regarding certain overseas transactions as suspicious. It's always good to have a backup to get you out of embarrassing situations should that happen.

Chris

Yes - I don't think the rule about a credit balance breaching the terms and conditions is applied to all credit cards. Obviously the Halifax Clarity Card makes some money from overseas transactions by charging interest - and if customers pre-loaded their cards with a credit balance - then that would prevent them from doing that.

I have paid my credit card bill in full by DD for many years and never had a problem. Whatever the balance is at the statement date - that is what is taken from my current account to pay it off. Works a treat and means I never have to pay any charges.

And if the payment was made in cash, especially if using an unattended paying in mechanism, it would be interesting to see how they would try to return the payment.

I do exactly the same. Interestingly, with my CapitalOne card, if there are any refunds from suppliers between statement and DD dates, the amount taken by the DD is *less* than the statement balance, to take account of the refunds. Possibly a mechanism to prevent credit balances? [In my case, there are always additional transactions in the meantime, so there wouldn't be a credit balance - but that may not apply to everybody].

Yes - that also happens with my Tesco credit card (which is the one I use in the UK). I don't know about the Saga card - I only use that on my foreign travels.

I had a Citibank card and got a refund that put it into credit. They therefore didn't take anything by direct debit.

The next statement had a big warning on it that I had missed my last payment and was in breach of the T&C and in danger of damaging my credit rating! I rang them up ands there was no real problem