Zero Interest credit card balance transfers

Australian credit card issuers are out to win new customers.  Long gone are the cozy days when similar interest rates, fees and charges applied.  Established credit card companies still prefer non-price marketing strategies to preserve their profit margins.  New and smaller players in the field are more likely to adopt aggressive pricing strategies to ‘buy’ market share. 

Competition can take the form of interest charged on carry-forward purchases and cash advances, waiving annual fees to new customers for 12 months, rewards programs and more recently, concessional interest rates on balances transferred from other credit card issuers.

Balance transfers involving ‘no’ and ‘low’ interest for a defined period are great attention grabbers as people see that they can make worthwhile savings by switching credit card companies.  And they’re correct!  Using a card balance of $3,000 for example, the saving over six months could amount to several hundred dollars.

Most of the applicable interest rates on Balance Transfers lie in the range 2% to 3% per annum.  If you take up a ‘Zero’ Interest Balance Transfer the short-term savings are even greater.

You need to ensure that what you save on the change-over is not going to be lost elsewhere.  For example, what is the pattern of your credit card usage?  Since you have a balance to transfer, you haven’t been paying off all your card purchases at the end of each month.  Focus on the standard interest rate, annual fees and other charges like charges for late payment.

There ‘s a cluster of other credit card offering a special interest rate of around 3% per annum on Balance Transfers.  The cards include Citibank’s Clear, Silver, Gold and Platinum credit cards as well at its co-branded Citibank BP MasterCard. Also in this category are ANZ Qantas Frequent Flyer Visa and its Frequent Flyer Gold Visa; and HSBC’s ‘Low-Rate’ Credit card.  All the cards in this group (apart from Citibank Clear), have a 12 month Balance Transfer term – the Citibank Clear card only runs for 6 months.

There are a number of zero and very low interest rate Balance Transfers to choose from – any one of which will save you money in the short term.  Do your research with Credit Card Application and be prepared to change your credit card issuer whenever you find them slipping behind the market pricing