The UK's Cheapest Credit Cards

Most credit cards charge interest rates of over 16.5% a year, but these cut-price cards are a good deal cheaper.

Although most credit cards provide you with an interest-free period of between 45 and 59 days, this applies only if you pay off your entire balance in full each month. Thus, if you spend on a credit card and don't clear your balance every month, then your card issuer will charge interest on your outstanding debt.My most recent analysis (covering more than three hundred different cards) showed that most credit cards charge a yearly interest rate of at least 16.5% APR on purchases. This is almost eleven percentage points greater than the Bank of England's base rate, which is currently 5.75% a year.Even worse, if you decide to withdraw cash on your credit card (always a bad move!), then you face interest rates which normally exceed 20% APR, plus additional cash-withdrawal fees of around 2.5% of the value of each withdrawal, with a minimum fee of £2.50. These elevated interest rates partly explain why credit-card firms make such juicy profits!However, there are a few credit cards which don't charge excessive interest rates on purchases. A quick search of The Fool's unbiased, independent credit-card search engine uncovered the following Best Buys:Credit cards with the lowest standard interest rate on purchasesCard issuer/namePurchaseAPR (%)NotesBarclaycardSimplicity Platinum Visa6.8Minimum annual income of £15,000.HalifaxFlat Rate MasterCard8.9Intelligent FinanceFlat Rate MasterCard8.9Yorkshire BSBase Rate Tracker Visa11.6Charges Bank of England base rate for the first six months, then base rate plus 5.5%. Cashback reward.Co-operative BankClear Visa11.9No additional fees or interest hike for cash withdrawals. Donation to good causes of 1.25p per £100 spent.Co-operative BankFlat Rate Platinum Visa11.9Rate fixed for five years. Minimum annual income of £25,000.Lloyds TSBAdvance MasterCard11.9No interest-free period. No interest on purchases for first six months.As you can see, it's possible to spend on a credit card and pay an annual interest rate of a mere 6.8% APR with the Barclaycard Simplicity Platinum Visa card. Obviously, if Barclaycard is able to charge such a low rate (just over 1% more than the Bank of England's base rate), then it's clear that other credit-card issuers are ripping off their cardholders with excessive interest rates!Finally, if you play your cards right, then you can get away with paying no interest at all on your spending, simply by using a 0% on purchases credit card which charges no interest on spending for up to a year. Furthermore, by transferring your existing card balances to a 0% on balance transfers credit card, you can avoid paying interest on your plastic debts for up to a year. Go for it!More:Five Best Cards For Transfers And Purchases | Five Ways To Make Money With Credit Cards