0% Balance Transfers Are Still The Popular Choice

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According to data that has been provided by the credit cards comparison site http://www.creditcards121.com, 0% balance transfers are still the most popular credit card choice among consumers in the UK. Even after the introduction of balance transfer fees and low interest credit card offers there has been no decrease in the demand for 0% balance transfer credit cards.

Data from the credit card comparison site http://www.creditcards121.com has shown that 0% balance transfer credit card offers remain as popular as ever despite the introduction of balance transfer fees and the proliferation of standard low rate interest credit cards.

One of their most popular cards, the Virgin card, offers a long term 0% balance transfer offer of nine months and demand has remained strong for this card even though is a 2% fee for balance transfers has been introduced. It has been speculated that with the introduction of balance transfer fees that consumers would switch to low rate credit cards instead, but this has failed to materialize.

According to user statistics from http://www.creditcards121.com this seems to be because 0% balance transfer deals can still represent good value to the consumer base they have been targeted by prior to the introduction of balance transfer fees. Their most popular card, Virgin, charge 2% handling charge or maximum of £35, this is true for most credit cards that charge on balance transfers with the maximum charge usually no more than £50. Consumers who wish to avoid paying interest on their balance and have no wish to increase their debt can still save money in comparison to a low rate offer.

According to information on Virgin's website, with a Sainsbury’s Bank Visa Card at 15.9%,a similar APR to many popular credit cards, you could save £112 in interest over 9 months by switching to Virgin’s 0% balance transfer deal with a £1,000 balance. This figure incorporates the balance transfer fee and aptly demonstrates there are still savings to be made from 0% balance transfer deals.                                                    

CreditCards121.com also adds:

“People are still seeking out the best balance transfer option that saves them money. The longest 0% balance transfer introductory offers are still the most popular. It seems as though visitors are not deterred by the balance transfer charge as they still see the offers as being good value and a money saving exercise.”

The core custom base for zero percent balance transfer fee cards has always been those who wish to avoid paying interest on a existing balance, rather than those who wish to save money on a credit card they spend on regularly. For these customers the transfer fee, while an expense that was only introduced recently, can be a nominal charge compared to the savings in interest charges made. Low rate credit cards may well be popular, but likely with a different segment of the credit card customer base, those who spend regularly and don’t always clear their balance. A zero percent deal would possibly present a bad deal because any new purchases made on many of these cards will still be charged interest and payments often come off the lower rate interest parts of the debt first.

Joseph Kenny at http://www.creditcardstore.co.uk notes: “Applicants of a 0% balance transfer credit card need to be aware of the fact that any purchases made on a credit card will be charged at the standard rate of interest unless there is a introductory purchase offer included with the balance transfer deal. Many introductory credit card offers, such as Virgin and MBNA, only provide the 0% rate to transferred balances; purchases will be charged interest at 15.9%. Any payments that you then make on the card are first applied to the balance transfer rate and interest will be accrued on your purchases, possibly putting you in a worse position than you were previously.”


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Joseph Kenny