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Associate Article

‘Rate tarts’ – check the brand

Without wanting to be too negative, it would probably be fair to say that this is the time of year most likely to leave you’re personal finances in need of an MOT. Let’s face it Christmas tis the season to rack up debt and its increasingly likely that it’ll be your flexible friend that takes the brunt of the festive spending.

Perhaps then the New Year is a good time to do something about that hefty credit card balance before you end up shedding pounds upon pounds on inflated interest rates. If any of your cards are charging you an expensive interest rate (anywhere near 20% could probably be improved upon unless your credit rating is particularly bad) then its high time to investigate the multitude of 0 per cent credit cards currently on the market.

The practice of transferring your credit card balance to take advantage of a cheap if not interest free introductory period on a new card has become pretty popular of late leading to a market apparently bulging with 0 per cent credit cards. Indeed there are apparently 96 to choose from at the moment, good news for that increasingly common section of the credit market – ‘rate tarts’ - who rely on there being another interest-free card to transfer their balance to each time an introductory period expires.

‘Rate tarting’ (not, I should emphasise, my term!) is widely trumpeted by financial advice websites like Money Saving Expert and could save you a packet in interest if you do it correctly. There is however something prospective rate tarts should be aware of – if you’re transferring your balance then it’s important you make sure that the new card isn’t issued by the same company as the old one. Ok, this may sound obvious but it’s actually a surprisingly easy mistake to make. The problem is that the credit card market is pretty much dominated by several very big companies so if, for instance you were switching from a GE Money card to an Asda 0% credit card you would, perhaps unwittingly, be switching between two cards that are issued by the same company – GE Capital Bank. Other examples include popular brands like NatWest Credit Cards, which is issued by RBS and Abbey which is MBNA.

The consequence of signing up for the Asda card would be that, as is universally the case, you won’t be allowed to transfer money between two cards controlled by the same company. Frustratingly you’d therefore have signed up for a shiny new card but would be unable to take advantage of its 0 per cent on balance transfers.

To make life a bit easier for you here’s a run down of just the 0 per cent on balance transfer cards (we haven’t got space for every card brand) complete with which company’s umbrella they’re under.

HBOS
AA, Amazon.co.uk, Bank of Scotland, Britannia BS, Halifax, Marriott, Norwich & Peterborough BS and Sainsbury's Bank

MBNA
Abbey, Alliance & Leicester, Bank of Cyprus, Cheshire BS, Dunfermline BS, MBNA, Melton Mowbray BS, SonyCard and Virgin Money

HSBC
Hilton HHonors, John Lewis and Waitrose, Morrisons and The GM Card


MINT, NatWest, RBS, Tesco and Ulster Bank (NI)

GE Capital Bank
Asda, Debenhams, GE Money, GE Capital Bank, House of Fraser

Citifinancial
Bmibaby, Citi and Shell

Allied Irish Bank (GB)
Allied Irish Bank (GB) and Saga

Bank of Ireland (UK)
Bank of Ireland (UK) and Post Office

Barclaycard
Barclaycard and Skycard

Clydesdale Bank
Clydesdale Bank and Yorkshire Bank

Co-operative Bank
Co-operative Bank and Yorkshire BS

The following 0 per cent card issuers have only one brand of card: Capital One, Egg, Lloyds TSB, Nationwide BS and Northern Bank.

For a more comprehensive list see Motley Fool Credit Cards.





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