You are here: Home - Credit Cards & Loans -

Capped credit cards on the wane

0
Written by:
25/02/2008

The number of credit cards with capped balance transfer fees is dwindling dramatically, according to MoneyExpert.com.

The independent financial comparison website says that a year ago consumers could choose from 18 different credit cards with capped balance transfer fees, whereas now that number has dropped to just seven offered by only five different providers.

And with the average balance transfer now as high as £2,666, MoneyExpert.com is warning so-called ‘rate tarts’ with balances of at least £3,000 that they could incur fees of over £100 just to transfer credit to a new provider.

Sean Gardner, chief executive of MoneyExpert.com, said: “Credit card switching is big business. Someone switches a credit card every two seconds and there are very few cards out there that still do not charge a fee for the privilege.

“Consumers looking to move credit card provider will be in for a nasty shock if they don’t choose a card with a capped balance transfer fee – so much so that the process of switching may be entirely pointless if the fee is too extravagant.”

According to MoneyExpert.com the average balance transfer fee is 2.8 per cent of the amount transferred, meaning the typical cost of a balance transfer is some £74.65.
And customers with higher balances could incur much larger fees – a £5,000 balance transfer could cost as much as £150 with a three per cent fee, which is not unusual.

Gardner continued: “In the past the simple advice for rate tarts was to look for a 0% deal, and then for a card with low balance transfer fees.

“Now however with the majority of long term 0% credit cards charging 2% or 3% for a balance transfer, getting a card that caps its fees might be a sensible option if you don’t like the look of one with no fee at all.”

 

Tagged:

Tag Box

Debt

Pension

Spending

Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
Single women in their 30s doing most overtime

Four out of 10 single women in their 30s do unpaid overtime at work, according to an analysis of official...

Close