10 Best Balance Transfer Credit Cards in the UK

10 Best Balance Transfer Credit Cards in the UK

10 Best Balance Transfer Credit Cards in the UK

What Is a Balance Transfer Credit Card?

When you spend money on a credit card, you create a balance that must be repaid. This can be settled completely during each billing period or through minimum monthly payments which usually incurs interest charges.

When a credit card has a balance that needs to be paid off, the interest rates can make it more expensive, and it can take longer.

To make the most of each payment, transferring a credit card balance to a new card with a low or zero interest rate offers the opportunity to pay the debt off faster, with fewer charges.

The new card should offer a 0% interest rate for a set period, or at least an extremely low interest rate.

This means that when you make your monthly repayments you are not paying any interest, so the balance reduces faster. This is especially useful for paying off balances quickly.

Balance transfer credit cards can be used for balances from other credit cards and store cards to consolidate the debt and make it easier to repay with one payment.

When Should You Consider a Balance Transfer Credit Card?

Getting a balance transfer credit card is a good idea if you have been using a card where the interest rate has gone up – either due to an introductory period ending or just general increases.

The change in interest rates can make the existing debt more expensive.

If you have multiple credit accounts, consolidation is a good reason to get a balance transfer card.

Having all the debit balances together to make one payment simplifies your outgoings and the reduction in interest payments means you will repay less.

Moving balances works best when you have a reasonably good credit rating so you can make sure that your credit limit is more than the total of the balances you need to transfer.

In most cases, the maximum you are allowed to transfer is up to 95% of your credit limit.

Things to Look Out For

There are a few things to look out for when considering different credit cards for balance transfers.

Credit Check

To be eligible for a balance transfer credit card, you will still need to pass a credit check – so having a good credit rating will ensure you will be accepted on the best terms.

The balances you want to transfer need to be less than the credit limit on your balance transfer credit card.

Different Bank or Group

You will not be able to transfer a balance between the same bank or group. This can be difficult when dealing with the bigger banking organizations like Lloyds, for example.

Introductory Rate

One of the most important things to look for in a balance transfer card is the introductory rate. The lower the better – most are 0%.

The introductory rate will only be available for a particular period, usually six to 35 months. This is the period during which you aim to clear the balance.

Choose the most appropriate length for you based on how long you need to pay it back.

Fees

Balance transfer cards usually charge a fee. This may be a set cost or a percentage (usually up to 4% of the balance to be transferred).

Finding a low transfer fee can save you money in the long run.

Time Limit

Make sure that you transfer all the balances from your other cards when you first get your new card.

There is usually a time limit for transfers to take advantage of the lower interest, so balance transfers should be made within the first 60 days.

Make Minimum Repayments

Through the introductory period, it is important to make at least the minimum repayments otherwise you will lose out on the lower interest rate.

High Interest After Introductory Period

After the 0% interest rate offer ends, the APR for the card will then revert – and this could mean that your costs will skyrocket.

This is the time where you need to make sure the balance is paid in full or prepare to transfer the balance to another 0% credit card.

Emergency Purchases

Although the main idea of utilizing a balance transfer card is to pay off debt, there may be a time when you need to spend money, such as for emergencies.

Finding a credit card with an introductory 0% rate for purchases as well as balance transfers can be a good compromise.

Annual Fees

Although they are mostly obsolete, some credit cards do charge annual fees and there may be other fees that come into the cost of your balance transfer.

Rewards

Some credit cards may come with rewards like discounts on purchases from retail partners.

Tips for Using Balance Transfer Credit Cards

Clear Debt Fast

Make sure that you are using the 0% interest period to clear the balance as quickly as possible.

When you take on the introductory period, work out how much you need to pay per month to clear the debt and stick to it for the best results.

Pay at Least the Minimum

As part of the credit agreement, you need to make at least the minimum monthly payments, or you will lose the 0% rate.

This could see costs go up massively and undo the good work of getting the lower interest rate.

Transfer Balances at the Start

To take advantage of the 0% interest rate, you will need to transfer the balances as soon as possible – usually within 60 days.

If you transfer outside of this window, you will be subject to extra fees and may not get the beneficial interest rates.

Don’t Add to the Debt

If you are consolidating credit into one monthly payment, try not to add extra money to it.

In some cases, purchases might have a 0% interest rate – but this is usually for a shorter period and may work out more expensive in the end.

10 Best Balance Transfer Cards

10 Best Balance Transfer Credit Cards in the UK
10 Best Balance Transfer Credit Cards in the UK

1. Virgin Money

The Virgin Money balance transfer card offers a longer introductory period than many other cards, with a 0% interest on purchases as well.

  • 0% interest on balance transfers
  • 24-month introductory period
  • 1.25% fee for balance transfers
  • 0% interest rate on purchases for three months
  • Interest rate after introductory period – 21.9% variable

Visit Virgin Money

2. Sainsbury’s Bank

For those who shop with Sainsbury’s and make use of the Nectar programme, the Sainsbury’s credit card is a good option, offering extra points per pound spent in Sainsbury’s, at TU Clothing or via Argos.

The interest-free period depends on eligibility, so not all applicants will receive all of it.

  • 0% interest on balance transfers
  • Up to 26-month introductory period
  • 2% balance transfer fee (minimum cost £3)
  • 0% interest on purchases for three months
  • Interest rate after introductory period – 21.9% variable

Visit Sainsbury’s Bank

3. MBNA

The MBNA credit card offers a soft-check option so you can see if you would be accepted without affecting your credit score.

All balance transfers need to be made within 60 days to qualify for the opening offers. Eligibility will affect the length of the introductory period.

  • 0% interest on balance transfers
  • Up to 25-month introductory period
  • 1% balance transfer fee
  • Interest rate after introductory period – 20.9% variable

Visit MBNA

4. Barclaycard

The Barclaycard Platinum card offers rewards like £30 cashback, as well as early entry and VIP tickets to the latest movies, gigs and events.

  • 0% interest on balance transfers
  • Up to 21-month introductory period
  • 0.9% balance transfer fee
  • 0% interest on purchases for up to six months
  • Interest rate after introductory period – 21.9% variable

Visit Barclaycard

5. Santander Everyday

The Santander Everyday credit card has a good range of rewards including up to 15% back from selected retailers.

It also has a lower interest rate after the introductory period (shorter than other banks) has ended.

  • 0% interest on balance transfers
  • 18-month introductory period
  • No balance transfer fee
  • 0% interest on purchases for three months
  • Interest rate after introductory period – 20.9% variable

Visit Santander Everyday

6. Tesco Bank

Although the Tesco Bank credit card does not have a 0% introductory rate for purchases, it does offer Clubcard points and other perks and rewards for Tesco shoppers.

  • 0% interest on balance transfers
  • 22-month introductory period
  • 2.99% balance transfer fee
  • Interest rate after introductory period – 20.94% variable

Visit Tesco Bank

7. First Direct

The First Direct balance transfer card is only available to First Direct bank customers but offers a preferential interest rate after the introductory period.

  • 0% interest on balance transfers
  • 27-month introductory period
  • 2.29% balance transfer fee (minimum cost £5)
  • Interest rate after introductory period – 18.9% variable

Visit First Direct

8. HSBC

An HSBC balance transfer credit card has no annual fees and provides holders with exclusive offers and discounts.

  • 0% interest on balance transfers
  • 25-month introductory period
  • 2.85% balance transfer fee (minimum cost £5)
  • 0% interest on purchases for three months
  • Interest rate after introductory period – 21.9% variable

Visit HSBC

9. Co-Op Bank

Available to Co-Operative Bank customers only, the Co-Op Bank balance transfer card has a reasonably long introductory period and no annual fee.

  • 0% interest on balance transfers
  • 24-month introductory period
  • 3% balance transfer fee (minimum cost £5)
  • 0% interest on purchases for three months
  • Interest rate after introductory period – 20.6% variable

Visit Co-Op Bank

10. M&S Bank

For M&S customers, any purchases made using the M&S credit card earn Sparks Card points – even outside the M&S stores.

  • 0% interest on balance transfers
  • 25-month introductory period
  • 2.85% balance transfer fee (minimum cost £5)
  • 0% interest on purchases for three months
  • Interest rate after introductory period – 19.9% variable

Visit M&S Bank

Final Thoughts

Making the decision to move credit and store card debts to a credit card with 0% interest makes sense when you are trying to pay what you owe while avoiding extra charges.

It is a decision that can clear debt faster and more efficiently through the consolidation of existing credit.

Choosing the right balance transfer credit card will depend mostly on your eligibility, and where your balances are currently held as you cannot transfer to the same bank or group.

WikiJob does not provide tax, investment or financial services and advice. The information provided is for general reference and you should not rely on it to make (or refrain from making) any financial decisions. Personal situations will vary. Always seek independent financial advice when choosing how to manage your finances.


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