Credit card fees and charges explained

Credit card fees and charges explained

If you’re thinking of getting a credit card, it’s important to be organised with your payments. If not, you could face unexpected charges and damage to your credit score, which could make it harder to borrow again in future.

You could be charged for both planned and unplanned things such as:

  • Missed or insufficient payments.
  • Using your card abroad.
  • Balance transfers.
  • Money transfers.
  • Cash transactions.


How credit card interest and charges work

Before you sign up for a credit card, make sure you’re aware of fees, charges and how credit card interest works. Credit card charges can be applied to your balance for things including late or missed payments, as well as transactions such as balance/money transfers or using your card abroad.

There are a few credit card fees to be aware of. You can read about them in this handy guide.

Credit card interest rates

There are three types of interest that can apply to your MBNA credit card account:

  • Promotional offers on balance transfers, money transfers and purchases. To keep any promotional rate you'll need to make the minimum payment on time each month and stay within your credit limit.
  • Up to 56 days interest free on purchases if you make your payment in full by your payment due date. If you don't make your payment in full (including the amount of any transfers) then standard interest rates apply from the date of the purchase until the balance is paid in full.
  • Standard interest rates for balance transfers, money transfers, cash transactions and purchases. Standard interest rates apply on balance transfers, money transfers, cash transactions and purchases once a promotional period has ended.

If you're unsure what interest rate you're being charged, check your credit card terms and conditions or the transactions pages of your PDF or paper statement. On your statement you will see a breakdown of your balance and the interest rates that apply.  If any of your balance has a promotional or introductory interest rate the expiry dates will also be shown there. 

Transfer and processing fees

These are the most common type of credit card fee:

  • Balance transfer fee, usually charged when moving a balance from another store or credit card to your MBNA account (normally a small percentage of the transfer amount).
  • Money transfer fee, usually applies when moving funds from your MBNA account to your UK bank/building society account (usually a small percentage of the transfer amount).
  • Using your card abroad. You may be charged additional fees and interest for making non-sterling transactions, or buying non-sterling currency.

Cash transaction fees

When using your credit card or card number, a cash transaction fee may apply for:

  • Using your available credit to obtain cash (e.g. at an ATM or at an over the counter service).
  • Gambling transactions, using your card to make transactions at casinos, betting outlets and bookmakers, and buying online lottery tickets or gaming chips, share trading or spread betting.
  • Buying foreign currency.
  • Sending money orders or wire transfers (other than balance transfers or money transfers).
  • Buying coins, banknotes or digital currency.
  • Paying government or court fines, enforcement penalties, fees or costs.
  • Online trading such as share dealing or investments.
  • Purchasing or topping up electronic money, payment cards, mobile wallets or account dashboard services.

Please refer to the terms and conditions of your account for specific details applying to you.

If you travel regularly, it might be a good idea to look for a credit card with a low or no foreign transaction fee - learn more about using your card abroadlearn more about using your card abroad.

Credit card default charges

We’ll let you know if any changes apply. They’re itemised on your statements, which is just one of the reasons it’s important to check the latest one each month.

Missed, late or insufficient payments

If you don’t make at least the minimum credit card payment by the due date shown on your statement each month, you’re likely to be charged a fee and lose any promotional offers on your credit card account.

You could set up a Direct Debit to make payments to your credit card account automatically each month - we’ll collect the amount you choose when it’s due.

Learn more about Direct Debits.

If it’d help to move your payment due date to one which suits you better, please call us.

Going over your credit card limit

If you go over your credit card limit, it could damage your credit score. You could also lose any promotional offers on your credit card account and be charged the standard interest rate instead. If you need to increase your credit card limit, speak to your credit card provider.

Returned payments

If you make a payment that we’re unable to process, your payment might be returned. That includes Direct Debits and cheques returned due to insufficient funds. In these instances, you might be charged by your bank.

Tips for managing credit well

  • Try to pay off your balance in full to avoid paying interest.
  • Avoid using your credit card to withdraw cash over the counter or at an ATM.
  • Don’t go over your credit card limit.
  • Take advantage of balance transfer cards with lower promotional rates to save money on interest payments.
  • Be aware of charges for things like using your card abroad – check your credit card terms and conditions for full details of any fees and charges.


Get help with money worries

There are things you can do if you're starting to experience money worries, so please talk to us.

You may need extra support from us if:

  • Your personal circumstances have changed - for instance, if you've been made redundant or you're dealing with a long term illness.
  • You're behind with payments or worrying about paying bills.
  • You're up to your credit limit on a regular basis.
     

Get help with money worries.

Credit card terms explained

What is a credit limit?

Your credit limit is simply the maximum amount of money available for you to spend on your credit card. Your credit limit will be based on your current circumstances when you apply for the credit card account. You must not go over this limit.

What is a cash transaction?

You may be charged for using your available credit to obtain cash (e.g. at an ATM or at an over-the-counter service)

  • Gambling transactions
  • Using your card to make transactions at casinos
  • Betting outlets and bookmakers, and buying online lottery tickets
  • Gaming chips, share trading or spread betting, buying foreign currency, sending money orders or wire transfers (other than balance transfers or money transfers)
  • Buying coins, banknotes or digital currency, paying government or court fines, enforcement penalties, fees or costs, online trading such as share dealing or investments, purchasing or topping up electronic money, payment cards, mobile wallets or account dashboard services.

What is a money transfer?

A money transfer lets you transfer money from your credit card to any of your own UK bank or building society accounts. You can benefit from a promotional interest rate on the transfers you make, but a transfer fee may apply. It will form part of your credit card balance and is subject to repayments as part of your monthly statement balance.

Understanding credit