You are here: Home - Credit Cards & Loans - News -

Interest-free credit cards offer cuts

Written by: Emma Lunn
The number of 0% interest balance transfer credit cards available has fallen while balance transfer fees have gone up.

Moneyfacts says the changes in the balance transfer credit card market echoes previous recessions.

The latest analysis from the financial data company found that the number of 0% introductory balance transfer offers has fallen to a record low. The drop since the start of 2020 echoes the fallout in the market seen in the 2007-09 recession.

There are now just 54 interest-free balance transfer cards available, down from 76 cards available at the start of 2020 – a difference of 22 cards.

During the last recession, between the start of December 2007 and June 2009, the number of interest-free balance transfer cards fell from 118 to 97 – a difference of 21 offers.

Balance transfer fees

The cost of moving debts is also on the rise, with the average balance transfer fee increasing from 2.27% in January 2020 to 2.32% now.

During the last recession, between the start of December 2007 and June 2009, the average balance transfer fee increased from 2.56% to 2.67%.

Separate analysis of the interest-free balance transfer card market shows that since the start of 2020, the number of cards with no balance transfer fee charged upfront are down from 13 deals from 11 providers in January, to nine deals from seven providers today,

Barclaycard, Tesco Bank, Halifax and Lloyds Bank have all pulled their fee-free offers from the market.

But Natwest, RBS, Ulster Bank, Santander and Danske Bank all still offer 0% interest balance transfer cards with no balance transfer fee.

Rachel Springall, finance expert at, said: “Borrowers searching for a new deal may wish to act quickly, but they should also be wary of balance transfer fees. In fact, since the start of 2020, the average balance transfer fee has crept up from 2.27% to 2.32% and the right deal may not be the one with the lengthiest interest-free offer.

“At the moment there are a handful of offers that do not charge a balance transfer fee at all, such as the 20-month 0% interest offer from NatWest, and if borrowers are able to clear a £3,000 debt within this timeframe, they would save themselves £69.60 based on the average balance transfer fee today.”

“Those consumers who may need to clear their bank account overdraft could turn to a money transfer card and the longest 0% deal today comes from MBNA on its Long 0% Money Transfer Credit Card Mastercard at 18 months for a 2.99% fee.

“As temporary overdraft support comes to an end, some consumers could be charged around 40% for dipping into the red, and a money transfer card could be an option if borrowers feel like they will be unable to clear their overdraft in the short-term.”

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.

Seven ways to get help with energy bills this winter

We knew today’s announcement was going to be painful, but it’s still a shock to the system. When this kick...

Flight cancelled or delayed? Your rights explained

With no sign of the problems in UK aviation easing over the peak summer period, many will worry whether holida...

Rail strikes: Your travel and refund rights

Thousands of railway workers will strike across three days this week, grinding much of the transport system to...

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.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week