SBT Monthly 0% Balance Transfer Credit Card Index – Balance Transfer Fees at Lowest Level in Two Years

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According to the SBT monthly survey, both balance transfer fees and average 0% balance transfer credit card durations declined in February. The former is a positive for consumers, while the latter does not bode well for the remainder of the year.

SBT 0% Balance Transfer Index

SBT 0% Balance Transfer Index

In terms of offer quality, February is by far the best month for consumers in the market for balance transfers since the credit crisis.

Balance transfer fees for 0% offers declined from 3.25% to 2.95%. This is the first time the average fees have dipped below 3% since Sept 2010. Fees are now 12% lower than last year. The average duration of 0% APR balance transfer credit card offers declined slightly in February, according to the SmartBalanceTransfers.com monthly survey of online balance transfer offers. The sharp decline in balance transfer fees in February is largely the result of limited time, no fee balance transfer offers available from Discover and Chase. When these two cards are excluded from the index, average balance transfer fees jump from 2.95% to 3.25%.

The driving force behind the decline in average balance transfer lengths in February was a reduction in 0% introductory periods by Citibank from 21 months to 18 months. This tightening impacted three offers in the survey and dragged down average 0% balance transfer durations to an even 12 months, the lowest level recorded since May of 2011 and a modest decrease from January’s average of 12.2 months.

At present, Citibank’s three 18 month 0% balance transfer offers along with an 18 month offer from Discover are the longest available, while both Wells Fargo and U.S. Bank continue to offer the shortest offers surveyed with 6 month durations.

According to Jeffrey Weber, Editor & Chief Card Analyst at Smart Balance Transfers, “In terms of offer quality, February is by far the best month for consumers in the market for balance transfers since the credit crisis. However, the shortening of 0% promotional periods by Citibank this month may mark the beginning of a downward move in introductory periods amongst all major issuers.”

Additionally, Mr. Weber points out that because no fee balance transfer offers from Chase and Discover are being offered as limited time promotions, “the window for consumers to obtain what are essentially the best balance transfer offers available in years may be closing shortly.”

About the SBT 0% Balance Transfer Offer Index

Updated monthly, the SBT 0% Balance Transfer Offer index reflects the average fee and promotional period for a basket of 22 credit card offers. These offers represent all banks included in the J.D. Power annual credit card satisfaction survey, including Citibank, Chase, Discover, Capital One, Bank of America, Barclay’s, Wells Fargo and U.S. Bank.

Additional commentary on this month's report can be found at http://www.smartbalancetransfers.com/blog/2012/02/february-2012-balance-transfer-credit-card-report-804/

About SmartBalanceTransfers.com

Founded in 2007, SmartBalanceTransfers.com - http://www.smartbalancetransfers.com/ - is a leading destination for consumers seeking targeted information on balance transfer credit cards. SmartBalanceTransfers.com provides consumers with in depth analysis of credit card offers as well as expert advice and tools to help consumers make wise choices when transferring credit card balances.

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Jeff Weber
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