The credit card market is on the move again with a drop in the balance transfer fee from Halifax.
Halifax has cut the balance transfer fee on its All in One credit card to 0.8% from 1%.
This pushes it into the top spot for credit cards with 0% interest on both balance transfers and new purchases. It has narrowly overtaken the second-best cards from NatWest and Royal Bank of Scotland, which have a fee of 0.9%.
The fee drop
The Halifax All in One MasterCard has a 15-month period of 0% interest for both balance transfers and new purchases.
This means you can move over an existing debt and for 15 months you won’t have to pay any interest on this money. When you transfer it onto the card you’ll need to pay a fee of 0.8%, which on a transfer of £2,000 would cost you £16.
On top of this any new purchases you make during the first 15 months can be bought without incurring interest. So it’s a handy card to use if you’re about to make a few big purchases and want to spread the cost out.
The fee drop is not as straightforward as it sounds, though. When you make a transfer, you'll actually have to pay a 3% fee. Then 2.2% of this will be refunded within 90 days of the balance transfer going through.
When the initial 15-month period ends the APR on the card is 17.9% and the only restriction is that you won’t be able to transfer over money from another Halifax or Bank of Scotland card.
The next best deal for these types of combination cards comes from Royal Bank of Scotland and NatWest. They both offer similar cards for 15 months which have a slightly higher fee of 0.9%.
Our comparison tables show a fuller view of the market but here I’ve outlined the top five choices if you're looking for a card with identical 0% periods.
|
Card |
Balance transfer |
Purchases |
APR |
|
15 months (0.8% fee) |
15 months |
17.9% |
|
|
15 months (0.9% fee) |
15 months |
16.9% |
|
|
Royal Bank of Scotland Platinum Balance Transfer and Purchase Credit Card |
15 months (0.9% fee) |
15 months |
16.9% |
|
14 months (2.9% fee) |
14 months |
18.9% |
|
|
Nine months (2.99% fee) |
Nine months |
16.9% |
Balance transfer cards
These cards are a good balance if you need a breather from interest payments in the short term, but if 15 months isn’t long enough, there are other cards around with longer 0% periods.
[SPOTLIGHT]When it comes to balance transfer cards the longest 0% interest period comes from Barclaycard at 28 months. This has a fee of 2.99% and a 0% purchase period for six months.
NatWest and Royal Bank of Scotland offer a 27-month 0% balance transfer card which has a fee of 2.64% and a six-month 0% purchase period.
For more read The best 0% balance transfer credit cards.
Purchase cards
You can also open up a card with a longer 0% purchase period but the options are more limited. The longest length around comes from Tesco for 18 months but this is only three more than the Halifax card.
For more read The best 0% purchase credit cards
Picking the best credit card
Credit card providers are forever trying to lure in new customers by offering an array of gimmicks. Therefore it’s important to look past any headline offers and check the card you’re applying for is actually of use.
The combination cards are great if you’re after a short-term break from interest payments, on both an existing debt or on any new items you’re planning on buying. But they’re not necessarily the best bet if you’re solely looking to clear an existing credit card debt - you may be better off going for a longer 0% period.
If you’re not in debt a reward or cashback card which pays you for spending on it is a good choice.