Number of fee free balance transfer cards falls

According to recent research the number of credit cards that allow fee free balance transfers with a 0% interest free period has fallen, and this is thought to be the result of credit card companies trying to recoup lost revenue.

0% balance transfer credit cards offer a specified interest free period that allows consumers to spread the cost of repaying their transferred balance without incurring interest, which means that the card issuer loses out on revenue from interest.

Credit card companies are still reeling from the financial losses of capped penalty fees, which were introduced by financial regulators last year, and meant that credit card companies could charge no more than twelve pounds per fee. It is a result of financial losses such as these that are thought to have resulted in fewer 0% balance transfer credit cards offering a fee free transfer.

There are many different 0% balance transfer credit cards on the market today, and most now charge a fee to consumers that want to transfer other credit card balances onto the card.

The fee is usually a set percentage of the amount being transferred in total, often with minimum and maximum charges. The percentage charged by way of a balance transfer fee can vary from one card issuer to another.

Consumers that wish to transfer their balances are urged to take the time to compare 0% balance transfer cards to see whether a fee is charged, and if so to compare the percentage charged in order to find a card that charges lower fees.

There are still a number of credit cards that allow consumers to transfer their balances without being charged a fee. Many cards that do charge fees have increased the percentages charged over the past year.

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Tom Smith
1st July 2007