Longest Interest Free Term On Credit Cards | moneyfacts.co.uk

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Derin Clark

Derin Clark

Online Reporter
Published: 13/12/2021
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Consumers looking to clear their credit card debt by moving their outstanding balances to a 0% balance transfer card will find that the average interest-free term is the longest it’s been since November 2018.

In fact, year-on-year the average number of interest-free days available on a 0% balance transfer credit card has increased by 57 days, up from 520 days in December 2020 to 577 days this month. The last time the interest-free period was longer was when it stood at 580 days.

As well as this, transferring balances has become cheaper over the past 12 months, with the average balance transfer fee falling from 2.22% a year ago to 1.96% now.

A 0% balance transfer credit card is often popular with consumers looking to pay down their credit card debt as the interest-free period makes repaying outstanding balances cheaper and quicker.

As Rachel Springall, finance expert at Moneyfacts.co.uk, explained: “In the run-up to the festive season it seems credit card providers have made overhauls to their interest-free balance transfer offers, which could well be perfectly timed for borrowers looking to consolidate their debts and have more time to pay off their balance without incurring interest. 0% introductory balance transfer terms have lengthened, associated fees to transfer have fallen and there is more choice.”

What are the longest interest-free terms?

M&S Bank and Santander currently have the longest interest-free term on a 0% balance credit card of 31 days. M&S Bank’s Transfer Plus Offer Mastercard has 31 months interest-free and charges a 1.99% transfer fee on balance transfers. Santander’s Everyday Long Term Balance Transfer Credit Card Mastercard charges no interest for 31 months and a transfer fee of 2.75%.

Sainsbury’s Bank, Tesco Bank, MBNA Limited and Virgin Money all have 0% balance transfer credit cards with interest-free terms of 30months. Sainsbury’s Bank’s 30 Month Balance Transfer Credit Card Mastercard charges a transfer fee of 1.50% or a minimum of £3 and also allows borrowers to earn Nectar points. Tesco’s Bank’s Clubcard Credit Card for 30 Month Balance Transfer Mastercard charges a transfer fee of 2.60%; borrowers can also earn Clubcard points when making purchases. Meanwhile, both MBNA Limited’s Long 0% Balance Transfer Credit Card Mastercard and Virgin Money’s 30 Month Balance Transfer Credit Card Mastercard charge a transfer fee of 2.95%.

0% balance transfer credit cards with no transfer fee

A number of banks offer 0% balance transfer credit cards that do not charge a transfer fee, including Sainsbury’s Bank’s 21 Month No Balance Transfer Fee Credit Card Mastercard, which has an interest-free period of 21 months and allows borrowers to earn Nectar points.

As well as this, the balance Transfer Credit Card deals from NatWest, Royal Bank of Scotland and Ulster Bank all have 0% balance transfer credit cards that do not charge a fee and have interest-free terms of 20 months.

Which is the best 0% balance transfer credit card?

Although consumers will often look for a credit card with the longest interest-free period this may not be the best deal for them. As Springall said: “As we head towards 2022, consumers would be wise to take time to compare offers now, especially if they are looking to consolidate debts. The best balance transfer card may not be the one with the longest 0% term, as borrowers could be better off seeking a shorter term with a lower balance transfer fee or even a fee-free option. Not only this, but borrowers are not guaranteed to get the advertised deal. Once they have a new card, being diligent and sticking to a repayment plan is as essential as it is to keep eyes on their credit report before applying for a credit card, or to seek debt advice if they are finding it hard to keep up with repayments.”

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