Credit Card News

HSBC has launched a new switching offer that will see consumers earn £125 simply by switching their bank account to a HSBC Advance Account or Premier Bank Account. This offer was launched in the same week that Virgin Money revealed a cashback incentive that will see its credit card customers earn up to 15% on everyday spending.

Here we’ve looked at both these incentives in more detail, as well as at some of the alternative switching and cashback offers currently available to consumers.

Credit card borrowers looking to transfer their debt onto an interest-free balance transfer card will be disappointed to find that the number of deals available has fallen year-on-year.

Research carried out by Moneyfacts.co.uk has found that in four years, the number of 0% balance transfer credit card deals has fallen by 66, from 126 available in February 2017 to just 60 available this month. As well as this, compared to a year ago, there are now 18 fewer 0% balance transfer deals available in the credit card charts, as during February 2020 borrowers had 78 deals to choose from.

In addition to the fall in deals available, the average number of interest-free days being offered on deals has also fallen. Four years ago, borrowers could get an average of 669 interest-free days in which to repay their credit card debt, whereas during February this year, the average number of interest-free days is 528.

The year-on-year fall in deals and interest-free terms suggests that borrowers looking to get the best 0% balance transfer deal may want to act soon rather than waiting. “It is hard to tell what attitude to risk credit card lenders will adopt during 2021 in light of the pandemic, and whether this may lead to a further reduction in interest-free balance transfer offers,” explained Rachel Springall, finance expert at Moneyfacts.co.uk. “Consumers looking to take advantage would be wise not to wait around too long and ensure they check their credit score before they apply. They should also be careful to weigh up the length of any deal and its fees, or even search for a shorter interest-free offer without fees instead.”

Whether a new year goal is to clear debts or to make home improvements, many consumers will be looking to take out a personal loan this January to fund their 2021 goal. But research carried out by Moneyfacts.co.uk has found that the average rate on borrowing a small sum of £3,000 has increased year-on-year, so this may not be the best option for consumers looking for the most cost-efficient way to borrow money.

The research has found that the average personal loan rate on sums of £3,000 has increased from 14.6% a year ago to 15.4% today. Saying this, consumers looking to borrow through a personal loan should compare deals on our personal loan chart as there are deals offering much lower rates when borrowing £3,000 over a three-year period.

Sometimes, applying for a credit card can be easier said than done. Applicants need to make sure they’ve got a stellar credit rating to even be considered, and unfortunately, this means that millions of people could face being locked out of credit – and many aren't even aware of the reasons why.

The current economic uncertainty could make it even more difficult for consumers to get approved for credit. When the pandemic first began impacting the UK economy, the majority of mortgage lenders began withdrawing mortgage deals for those with a 10% deposit or less from the market – making it harder for many first-time buyers to get a deal – and, although many credit card and personal loan deals remained available, borrowers may have found it harder to get applications accepted. One of the biggest factors to getting approved for credit is the applicant’s credit score and having a poor credit score could result in the credit application being rejected.