When I make a manual payment, what balance does it get applied to first?
Your payment will go towards your statement balance first. If you submit a manual payment greater than your statement balance, anything that is left over will go towards your pay over time balance if you have one. We do this to help reduce the amount of statement fees you'd pay for rolling over your statement balance into pay-over-time.
For example, imagine you have a statement balance of $100 and a pay-over-time balance of $400. If you make a $50 manual payment, your current statement balance will be reduced to $50. If you make a manual payment of $300, your statement balance will go to $0, and your pay-over-time balance will decrease to $200.
If you make a manual payment during the grace period, your payment will go to the past month's statement balance first. Any payment in excess of the past statement month's balance will then go towards the current month's balance followed by the pay over time balance.
For example, imagine it is February 3. You’re still within the grace period for January, and you have the following balances:
- January: $500
- February: $100
- Pay-over-time: $500
If you make a manual payment of $550, you’ll wipe out your balance from January and avoid paying a statement fee. You’ll also reduce February’s balance to $50.
If you were to make a manual payment of $1,000 in this scenario, the first $500 would go to paying off January’s balance, the next $100 would pay off February’s balance, and the remaining $400 would be applied to your pay-over-time balance. This would leave you with a pay-over-time balance of $100.
Please note: If you want to avoid statement fees, you must ensure that the full statement balance is paid by the end of the grace period.
In the example above, you would need to make a manual payment of $500 by 11:59 pm Pacific Time on February 7 to cover January’s statement balance if you have pay over time set up as your default payment method.
If you have pay in full selected as your autopay setting, then Parafin will automatically attempt to debit the full statement balance of $500 from your bank account on February 7. If the payment fails, January’s full statement balance of $500 will be rolled over into your existing pay-over-time balance along with a statement fee of 11% - 16% of the $500 statement balance. (For more information, please see your Spend Card Agreement.)
If you’re a pay-in-full user and are worried about the automatic payment failing for whatever reason, you may make a manual payment by the final day of the grace period. We will only debit your account for whatever remains of the statement balance on the final day of the grace period.
If your outstanding balance is paid off much faster than expected, whether through an automated (i.e., sales-based) or manual payment, you may receive a fee discount in the form of a statement credit.
Parafin is a financial technology company, not a bank. Spend Cards are issued by Column N.A., Member FDIC, pursuant to a license from Visa U.S.A. Inc., and are powered by Marqeta. Approval is not guaranteed and is subject to checks. Terms and conditions apply.