Reader complaint
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  • How does a bank calculate interest?
  • I paid in full but my next statement shows interest
  • Bank explained the interest calculation and also offered a gesture cashback

I have been a good paying client for more than two years with Mashreq. On December 20, 2018, I paid online my November statement for my Smart saver card since it was already due on the same day. The amount was deducted on my account the same day. To my surprise, I was charged for interest and late payment fees. I called their customer service to explain the situation and request for the reversal of the fees but it was not accepted because according to them it was received on December 22, and not December 20; even though I told them I can send them my bank statement showing the payment was debited on December 20.

I paid the full amount but still on my next Statement there is still interest.

- Ms Dianne Jennifer Caulo, Dubai

After paying the late payment fees and interest amounting to Dh852.09. It says on the Statement Avoid Financial Charges Payment should be Dh5,809.64 (includes the Dh852.09). I paid the full amount but still on my next Statement there is still interest. I tried calling them for the explanation and how did they compute the interest. The Customer Service cannot explain to me and she said nobody can help me on the computation as it is automatic on their system. Even on the recent statement I paid Dh5,410 against full outstanding of Dh5,914.00. To my surprise on the next statement the interest was Dh485.94. I think it is too much. Charging Dh485.94 for the balance of Dh500. I just gave birth and would appreciate if they give a consideration on my situation. I hope this will be resolved soon. Thank you.

From Ms Dianne Jennifer Caulo


The management of Mashreq responds: Thank you for highlighting Ms Dianne Caulo’s concern to us.

Ms Caulo had initiated a credit card payment through local transfer on December 20, 2018 however the initiator bank has only processed the remittance on the next working day, December 22, 2018 which was after the due date, hence Ms Caulo has been levied with late payment fees and purchase interest.

As per our credit card terms, If there is any outstanding balance of unpaid transactions following the payment due date, then interest will be charged on the daily closing balance from the date of each transaction. This will appear on the next statement hence further interest has been levied in the subsequent statement, which is from the statement date till the payment date.

We have contacted Ms Caulo and explained the interest calculation and also offered a gesture cashback since the payment initiated by her was not successful due to the remitter bank delay.

We take this opportunity to thank Gulf News once again for bringing this issue to our notice.

Thank you.

(Process initiation: March 11, 2019. Response from organisation: March 13, 2019.)

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