0% Credit Cards in the UK

How Can Credit Card Companies Afford To Have 0% Interest Credit Cards?

Credit cards are a big business in the UK and the world over. Credit card companies, like other companies, are in business to make money. They also need to offer incentives to customers in order to get them to take their cards over those offered by other companies. One such incentive is to offer 0% interest rate for an introductory time period. Some companies offer this 0% for balance transfers, some offer it for new purchases and some offer it for both. The length of time that the interest rate remains at 0% varies but is usually between six and nine months.

The interest rate (APR) after the interest-free period is over, is usually much higher than standard credit cards. The credit card companies bank on the fact that most people don’t pay off the balance before the interest rate starts and they make up the difference in interest charges over time. Many people are just not savvy enough to keep a close watch on their credit cards. The credit card companies know that most people are in too much debt. In fact, the total amount of credit card debt in the UK now is over L180 billion.

Financial consultants recommend you do not charge anything on the new credit card, even if the card offers 0% interest on new purchases as well. When you start to have too many credit cards, the risk of abusing them increases. That just leads to a downward debt spiral that you may have a hard time coming out of. Should you always have at least one available credit card for emergencies? Most financial advisors agree, yes. The key is to keep one card with no balance. To keep from charging other things on it, freeze it. They advise to literally freeze your credit card in a small tub of water, in your freezer. When you really need it, you can defrost it and use it. However, it will deter you from making impulse purchases. You must really think through your purchase while the tub thaws. (You can’t quickly thaw it in the microwave oven because that could affect the metal strip)

If you have large debt on another, higher interest credit card, you should consider using a 0% interest card to help you out. You will likely save hundreds of dollars in interest. The main thing to remember when using a 0% interest card for debt assistance is to make sure that the entire balance is paid off by the end of the 0% interest time period. If not, you may end up paying more in interest and will not have helped yourself at all. Financial planners advise to seek an extension on the 0% card if you are coming to the end of the time period and you still have a significant balance. Many credit card companies will extend the 0%, sometimes as much as a year.

Eligibility for offers for 0% credit cards usually (but not always) depend on the credit score of the applicant. If you have a high credit rating, you're much more likely to qualify. It's worth applying, though, because usually they'll offer you a low-interest credit card even if you don't apply for the zero-interest offer.

Some of the top no interest credit cards offered in the UK include Citi Platinum Select Card, which offers 0% APR on balance transfers and purchases for a period of 12 months. They offer ?0 liability on unauthorized purchases and do not charge any annual fee. The 0% card has a regular APR of 10.74%. Chase Platinum Credit Card, too, offers 0% credit cards for 12 months or for 3 months, depending on the credit history of the applicant.

Blue from American Express features a 0% introductory APR up to 15 months and charges no yearly fee. The card's regular APR is about 11.74% and applicants do not have to have an exceptional credit record in order to get this credit offer.

There is also Blue Cash from American Express, which offers 5% cash back on all qualified purchases. This offer for their 0% credit cards is for six months and they do not charge an annual fee.

With Value Miles Platinum Visa Card, (a frequent flier credit card), the card holder can earn one value mile for every dollar spent. With 24,000 miles you earn can get an airline ticket for any nearby destination. They also do not charge yearly fees and the 0% interest applies to the first 12 months.

HSBC Platinum Master Card offers 12 months of 0% APR and it benefits include unlimited purchase protection and insurance for travel accidents. Their regular APR is 10.74%.

Citi Diamond Preferred Rewards Card offers a ?50 gift card and for every ?1 spent on purchases in drugstores, supermarkets and gas stations can card holders get 5 reward points and 1 point for every other purchase. Of a similar type is the GM Flexible Earnings Card, which offers 0% introductory APR for a year which presents a full one-percent cash back choice, otherwise the cardholder can choose a one-percent earnings towards any new GM vehicle.

Other companies that offer 0% credit cards also include Starbucks Duetto Visa for six months and Northwest Airlines- WorldPerks Visa Platinum Card, which has a credit line up to ?7,500 and a 15,000 miles annual WorldPerks travel reduction. The Northwest card does charge an annual fee of ?55, though.