More Bad News for Credit Card ‘Rate Tarts’ - Credit cards - News - Moneyfacts

News News brings you the latest financial & economic news & reviews of the best products in the UK by our team of money experts.

More Bad News for Credit Card ‘Rate Tarts’

More Bad News for Credit Card ‘Rate Tarts’

Category: Credit cards

Updated: 31/10/2008
First Published: 16/12/2005

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Consumers looking for a long term 0% home for their credit card debt will be dismayed to learn that one of the longest interest free term deals on the market is being withdrawn today. The Capital One Platinum credit card 0% balance transfer deal was launched in September this year and at the time was offering a generous 15 month 0% deal for balance transfers until 1/1/2007.

Andrew Britchford, personal finance analyst from comments: "This is a sign of the times in the current credit card market, with PwC recently revealing that the 0% money is costing the industry over £600m per annum.

"On top of this, there are reportedly a rising number of people defaulting on debts which is further adding to the adverse effect on lenders profit levels"

"According to research, at the beginning of 2005 there were 114 credit cards offering 0% deals with a term greater than five months; this number is now down to 91 and likely to fall further. During the same period, the number of credit cards charging a balance transfer fee has increased from 12 to 41."

"Capital One will certainly not be the last big card player to withdraw from the 0% war, and with conditions still tough in this market, providers will be looking at alternative ways of reducing their share of the £600m annual cost of providing this 'free money'."

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Credit card mistakes cost borrowers £948m

At this time of year, many people could be turning to balance transfer credit cards in an attempt to overcome their Christmas debt. However, many of these borrowers could get caught out in the year ahead, and they could end up paying for it.

6 of the best balance transfer credit cards

Does the thought of opening your credit card bills fill you with fear? If so, you're not alone! Christmas may be over, but unfortunately, many people will still be paying for it, after turning to credit to cover the cost of their festive spend.

Get a better credit score for the New Year

A new year means a fresh start, and one of the best things you can do is take a cold, hard look at your finances – particularly when it comes to your credit score.