Customers who are looking for attractive zero per cent balance transfer credit cards, will have trouble as they face a lack of choice and rising borrowing costs, both contributing to increased difficulties, according to recent research.
A number of industry professionals have commented on the situation recently.
One official from Sainsbury’s Finance said: “Although there are a number of credit cards offering introductory 0 per cent on balance transfers, there is a considerable difference in their duration, so people need to choose carefully. Also, when choosing a credit card for a balance transfer, it is worth considering what else it offers. For example, we offer zero interest for a whole year on Sainsbury’s purchases as well as earning Nectar points equivalent to 2 per cent cash back.”
Another industry official stated: “When looking for a new provider to take over your balance, there are two hurdles to jump. Firstly you cannot transfer balances between cards backed by the same provider, or which is part of the same banking group. For example, not only does MBNA issue its own cards, it also backs Virgin Money and Alliance & Leicester cards, to name a couple.”
She went on to say: “Secondly, most deals are only available to new customers, so you can’t afford to complete the circuit of card providers too frequently. Typically your account will need to have been closed between 12 and 24 months before you can be considered a new customer again.”
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