UK: Barclaycard Announces 0% Credit Card Transfer for 26 Months

new interest free offers from Barclaycard and Tesco BankCompetition between credit card companies in the United Kingdom is heating up, with market-leader Barclaycard offering a zero interest rate on credit card transfers for a staggering 26 months. This was a direct response to rival Tesco Bank‘s announcement of a card with interest-free transfers for 25 months.

For anyone who has run up debt on their credit card and is now in the process of getting their finances under control, this is worth considering taking advantage of if you will be able to clear the debt before the interest-free period ends. It’s less of a good idea for anyone who has not worked out an effective spending plan or still has a problem with spending money they do not have.

However, it’s important to note that while both these credit cards offer an extended period with no interest, there is a “transfer fee”: 3.5% for the Barclaycard and 2.9% for the Tesco Bank card. This means that a transfer of £2000 would cost £70 and £58 respectively. There is also a percentage limit on how much you can transfer, based on the card’s credit limit: the Barclaycard allows you to transfer 90% while Tesco Bank allows 95%.

There are differences once the interest-free period ends too – the standard annual percentage rate is 18.9% on the Barclaycard and noticeably less on the Tesco Bank card: 16.9%. This, and the lower transfer fee makes the Tesco offer the winner in our opinion, even if the promotional period is a month shorter. You can find out more over in the Daily Mail’s Money section.

Philip

4 Comments

  1. WOW! Wish a ‘credit card war’ would happen here in the US. I need to transfer some dental bills my little girl racked up. Those are some really incredible deals.

  2. That’s kind of cool! It reminds me of something I read in Details magazine back in 94, about finding credit cards with no transfer fees and bouncing the balance between 3 or 4 cards at zero interest until it can be paid off. I would recommend such an approach as a way of life, but it can still get you through some hard times for the short term.

  3. Oh, ok, so they are offering one extra month compared to their rivals? It’s better than nothing, though. So, this is still valid? I understand that Barclaycard offers a zero interest rate on credit card transfers until 2015, correct? 🙂 In that case, I’m off to the bank 😀

    • There have been a few developments since I wrote this last year, and it seems that Barclaycard’s current offer is 0% interest for 32 months – even better. And although the transfer fee is still 3.5%, they give you a rebate that reduces it to 2.9%. I have to say, 32 months gives you a good chance to get the whole debt paid off before the interest kicks in. You can read about it here: http://www.barclaycard.co.uk/personal/credit-cards/platinum-balance-transfer#tabbox0

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