Best 0% interest rate credit card deals

Credit card providers must reduce their charges after the Office of Fair Trading ruled that the fees many levy for late payments and exceeding credit limits are illegal and unjustifiable. This should be great news for credit card customers but consumer groups are warning that there could be a sting in the tail.

Many card companies charge more than £20 if a customer is just one day late making a payment or goes over his or her credit limit. The credit card industry rakes in £300m a year from such fees. Following the OFT’s ruling, these charges will have to be capped at £12. But, rather than taking the dint to profits, providers are expected to recoup the revenue they will lose from the reduction in charges in other ways. Uswitch.com, a comparison website, thinks that providers could increase the interest rates they charge by around 2% in order to claw back the money. And research group Defaqto is warning that interest free deals will be watered down.

So if you are wanting to take advantage of one of the 0% credit card deals available, it could be worth acting sooner rather than later. The good news is, that for the time being at least, there are still plenty to choose from. You can find details of all the deals available at comparison websites such as moneysupermarket.com, uswitch.com or moneyfacts.co.uk. Here we guide you through some of the best offers.

Sainsbury’s Bank has launched a new visa card with a 12-month interest free period for purchases. This is the longest 0% purchase deal available. Once the introductory offer ends you will be charged the standard rate of interest, which is 15.9%. The card is also good if you are looking to make a balance transfer. The rate is 5.9% and this lasts until the balance is cleared. However, you should avoid transferring a balance onto the card if you are going to use it for spending as well because, like most providers, Sainsbury’s Bank clear the cheapest debt first so you will accrue interest at the highest rate. If you want to take advantage of this deal, you will have to act quickly as it will only be available until the end of May.