AA launches new 0% money transfer credit card

New card to help clear your overdraft.

The AA has launched a new 0% balance transfer credit card.

It offers 0% on balance transfers for 28 months for a 2.9% fee. But this isn’t the card's main attraction.

It also comes with 28 months of 0% interest on money transfers - a feature which attracts a bigger 4% fee but can be used to clear your overdraft.

0% money transfers

A 0% money transfer is a feature offered by a small number of 0% balance transfer credit cards. It allows you to transfer money from your credit card into your current account, which makes it a good tool for clearing your overdraft.

Once you've shifted your overdraft debt to your card, you can then take your time clearing the balance as it will benefit from a decent 0% period.

The only downside is you'll have to pay a fee upfront. You’ll also have to be able to make the minimum repayment on the card each month. If you’re late with a payment, the 0% deal can be terminated and you'll also get a black mark on your credit report.

It's also worth noting that if you haven't paid off the debt within the 0% period you'll start paying interest on it again.

The new AA credit card

The new AA 28-Month Balance Transfer Credit Card allows you to freeze interest for two years and four months on transfers made within 60 days of taking out the card for a 4% fee.

So if you had a £2,000 overdraft costing you a bomb in interest charges each month, you could use the AA card to clear your debt in one fell swoop for a one-off fee of £80.

And in order to clear the debt you transfer onto the card you would need to make payments of around £71.43 a month before the 0% period ends.

How it compares

Here’s how the new AA card compares when it comes to 0% money transfer offers. (To see how it compares on 0% balance transfer check out The best 0% balance transfer credit cards.)

Credit card	0% money transfer period	0% money transfer fee	Cost of transferring £2,000	Representative APR
MBNA Platinum Credit Card	31 months	4%	£80	18.9%
Leeds Building Society Credit Card	30 months	4%	£80	18.9%
Virgin Money Balance Transfer Credit Card	29 months	4%	£80	18.9%
Fluid 29-Month Balance Transfer Credit Card	29 months	4%	£80	18.9%
AA 28-Month Balance Transfer Credit Card	28 months	4%	£80	18.9%
MBNA Charity Credit Cards (Breakthrough Breast Cancer, British Heart Foundation, RSPCA, National Trust or WWF)	24 months	4%	£80	18.9%
MBNA Football Credit Cards (Arsenal, Chelsea, Liverpool FC, Manchester United, Tottenham Hotspur or Aston Villa)	24 months	4%	£80	18.9%
MBNA Everyday Credit Card	21 months	4%	£80	14.9%

As you can see there isn’t much variation in the cost when it comes to the top 0% money transfer credit cards; all charge 4% and all apart from the MBNA Everyday Credit Card come with a representative APR of 18.9%.

However, the pick of the crop has to be the MBNA Platinum Credit Card which offers a whopping 31 months to pay back any cash advance you make. That’s three months more than the AA card, allowing you spread out repayments further to clear your debt .

The MBNA Platinum Credit Card also offers an eligibility check, which means you can see if you can get the card before applying without impacting your credit rating.

You can keep up with the latest 0% money transfer offers in: The best 0% money transfer credit cards.

Cheaper deals

If you're looking for a cheaper money transfer you’ll have to sacrifice the length of the 0% period you get to clear what you advance.

MBNA’s Airline Credit Cards (Virgin Atlantic White, Virgin Atlantic Black, Emirates Skywards, Emirates Skywards Elite, Etihad Guest, Mileage Plus and AAdvantage) offer six months of 0% interest on money transfers for a fee of 2% as well as the ability to earn airmiles to use for discounts on flights and holidays.

That’s half the cost of the longer lasting cards but it means you’ll have a much shorter period of time to clear the debt before interest kicks in again.

Other ways to clear overdraft debt

If you don’t fancy using a credit card to help clear your outstanding overdraft debt you could try and switch your current account.

But not even the best interest-free deals on overdrafts come close to what the best 0% money transfer cards can offer.

At the moment Nationwide’s FlexDirect is the top account to go for which offers a fee-free overdraft for a year. Read Where to find the cheapest overdraft for more.

Alternatively you could try a personal loan.

The rates on a personal loan tend to be significantly cheaper than overdrafts, but you'll need a good credit history to get the best deals. If your credit history isn’t perfect, you may be offered a higher rate, but if it’s below the amount you're being charge on your overdraft then it's still worth going for.

See The cheapest personal loans for the best rates right now.

More on credit cards:

The best 0% purchase credit cards

The best 0% balance transfer credit cards

The best credit cards to use on your travels

Best credit cards if you have a bad credit history