Credit cards providers battling it out to entice new customers

25th October 2013

The big players in the credit card market have upped the length of their interest free balance transfer periods in a bid to try and entice new customers ahead of the festive season.

On Friday Barclaycard extended the 0% interest period on its Platinum Visa card to 30 months – topping the best buy tables – the equivalent of a two and a half year interest free loan. This card has a balance transfer fee of 2.9% – you will initially pay 4.9% which will be reduced to 2.9% by refund. It has a representative APR of 18.9% and a 0% interest offer on purchases for six months.

And the Tesco Clubcard credit card has also increased its interest free balance transfer period from 27 to 28 months, with a transfer fee of 2.9%. Its representative APR is 18.9% and cardholders can earn Clubcard points while they spend. It offers 0% on purchases for three months.

Natwest has also joined the fray by extending its 0% interest on balance transfer Platinum card from 26 to 27 months. It has a balance transfer fee of 2.5% and a representative APR of 18.9%. It also has 0% interest on purchases for three months.

Halifax also offer 0% interest on balance transfers for 27 months, on its platinum card. That has a balance transfer fee of 2.64% and an interest free period on purchases for six months. Its representative APR is also 18.9%.

For customers who have a lot to debt to transfer, and are able to clear it quickly, a low balance transfer fee card may be the best option, and there are many good deals in the market at the moment.

The Halifax All in One Online MasterCard and the Lloyds Bank Platinum Balance Transfer MasterCard both have 0% interest offers on balance transfers for 15 months, for a low transfer fee of 0.8% – both have a representative APR of 17.9%. The Halifax card also offers 0% on purchases for 15 months, while the Lloyds Bank card has 0% on purchases for three months.

For those that are looking to merely offset the cost of Christmas for a few months, then the Tesco Clubcard credit card for purchases could be the one for them. It offers 0% on purchases for 18 months and its representative APR is 16.9%.

Gocompare.com’s credit card expert, Matt Sanders, says: “Organising a Christmas shopping budget is always tricky, whether you’re an early shopper or a panic buyer, managing money at this time of the year is a challenge.

“Gocompare.com ran a survey that discovered that 23% of customers said they didn’t expect to have paid off their Christmas spending on credit and store cards by the end of January, with some believing that it would take until the end of June to pay off their festive shopping.

“But there are ways, using the credit card system, which will make it easier for shoppers to plan and pay off their festive spending.”

He adds: “Timing your application for one of the long 0% balance transfer cards – you usually have to transfer a balance within a 90 day period – to include the New Year, means that you can transfer a balance from a card you used over the Christmas period and pay no interest on that debt for a few months.

“Or apply for a 0% purchase card and spend on that, knowing that you have no interest to pay for over a year in most cases.

“If you normally do most of your shopping in a certain store – why not collect loyalty points by using their credit card. Tesco and Marks and Spencer both offer credit cards with loyalty points connected, so you can earn points as you spend.”

 

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