The best ever 0% balance transfer credit cards

Fancy 16 months interest-free credit on your balance? Well, look no further.

Just three months ago everyone was predicting the bottom would fall out of the 0% credit card market - including us. In Borrowers: Your worst nightmare just came true we waved goodbye to the long-standing best-buy, Virgin. It also looked like a raft of rule changes due to be forced on credit card providers would spell the end of once lucrative interest-free balance transfer deals.

Thankfully, we were all wrong. Balance transfers are still very much alive and kicking with a host of new cards which offer interest-free periods lasting well over a year. But more recently two new 0% balance transfer cards have been launched which offer the longest interest-free periods yet.

Great deals from NatWest/RBS

Back in May, the Yorkshire/Clydesdale Bank introduced a fantastic card which offered interest-free credit for a whopping 16 months. Now NatWest and the Royal Bank of Scotland have followed suit with the NatWest Platinum Credit Card and the Royal Bank of Scotland Platinum Credit Card.

(Technically, the cards are one and the same as both brands are part of the Royal Bank of Scotland Group.)

These brand new deals offer the same 16-month interest-free period, but they’re a shade better than the cards from the Yorkshire/Clydesdale. This is because the transfer fee is slightly lower at 2.9%, rather than 3%. True, there’s not much in it, but if I had to pick a winner, NatWest/RBS would be it.  

The 2.9% transfer fee means you’ll be charged £29 per £1,000 moved onto the card.

Interest-free deals which this long give you a great opportunity to clear your credit card debt before the introductory period runs out. If you transferred a balance of say, £2,000, and then paid £128.63 a month, you would have completely cleared your balance and the fee before the 0% rate disappears.  

New market-leading 0% balance transfer cards in a nutshell

So here is a quick rundown of everything the NatWest Platinum Credit Card and the Royal Bank of Scotland Platinum Credit Card has to offer:

• Interest-free credit on balance transfers for 16 months;
• Interest-free credit on purchases for 3 months;
• Balance transfer fee of 2.9%;
• 16.9% typical APR. The APR will be reduced by 1% to 15.9% for NatWest Advantage Gold current account customers and RBS Royalties Gold customers. (But, don’t forget, you should never end up paying the typical APR);
• The cards are only available online;
• You need an income of £10,000+ to be eligible.

The finer details

Don’t forget, to take advantage of this fantastic 0% offer, you’ll need to transfer your balance within the first three months after setting up your new card. You should also note that transfers from other RBS Group credit cards aren’t permitted. Although, if you’re an existing NatWest or RBS bank customer and you already have one of their credit cards, you can still apply for the Platinum card.

Recent question on this topic

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  Can Barclaycard change the interest rate on a card without any communication.

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    JoeEasedale answered "3% is not the standard rate for the card? It is the minimum payment? By the sound of it, they have..."
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    MikeGG1 answered "James You don't appear to have correct information. Are you absolutely sure that INTEREST rate..."
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It’s important to know that your balance transfer is limited to a maximum of 95% of your credit limit. In other words, if you’re given a credit limit of say £4,000, the most you can transfer over from another card is £3,800.

And, in common with most other credit card companies, if you don’t pay your bill on time, or you exceed your credit limit, you risk losing the 0% offer.

Purchases

You’ll have noticed, in addition to the brilliant balance transfer deal, the NatWest Platinum Credit Card and the Royal Bank of Scotland Platinum Credit Card offer three months’ interest-free credit on everything you buy for three months too.

But, if you’re after interest-free spending, I think you’re better off looking elsewhere for two reasons. Firstly, the purchases deal really isn’t very generous. After all, the new market-leading Tesco Clubcard Credit Card offers 13 months interest-free on all your spending which is far, far better than the 0% purchases deal on offer from NatWest and RBS. And you can earn extra clubcard points too boot.

And secondly, you run the risk of falling foul of ‘negative order of payment’ by using one credit card for both your balance transfer and purchases.

Negative order of payment means the cheapest debts will be paid off first leaving the more expensive debts on the card longer to rack up stacks more interest. So, in practice, your repayments will be used to clear the balance you have transferred before your purchases, which will start being charged at 16.9% APR once three months has passed. In fact, your more costly purchases won’t even begin to be paid off until the balance transfer has been completely cleared first.

You can find out more about negative order of payment in this video.

From September, credit card companies will no longer be allowed to operate negative order of payment. Instead, they will have to switch over to positive order of payment where the most costly debts are repaid ahead of any others.

But, in the meantime you can prevent this from happen by using the NatWest Platinum Credit Card or the Royal Bank of Scotland Platinum Credit Card for your balance transfer only, and the Tesco Clubcard Credit Card as a second choice for interest-free spending. In this way, you’ll have the best-buy of both worlds.

Compare credit cards at lovemoney.com

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