Chris Griffiths, head of Credit Cards says: “Today Virgin have improved their credit card offering and top the best buys as the new market leading balance transfer card. With 0% interest on balance transfers for 16 months, and a typical APR of 16.8%, it just edges ahead of the MBNA Platinum card courtesy of the 2.89% BT handling fee. RBS and NatWest have also extended their 0% BT period back up to 16 months, although the cards continue to be available to existing current account customers only.
This type of competition is great for those looking to consolidate existing debts, with significant savings to be made over 16 months if the balance stays interest free. A typical customer transferring a balance of £2,2001 could save £4472 over 16 months compared to those paying the average 18.69% APR3.
“These introductory offers won’t stay around forever so customers need to move quickly. Shopping around is the simplest way to find the best card to suit every personal circumstance. Customers should consider what cards they currently hold and where they are looking to move a balance from as these factors will influence the options available. It is also crucial to be responsible and stay within the credit limit as well as ensuring payments are up to date or else there is a risk the introductory offer will be withdrawn”
1. £2,200 is the current average balance transfer amount reported by the British Banking Association (2/11/2010)
2. A customer paying the minimum 2.5% each month could expect to accrue £511.06 interest over 16 months. The BT handling fee of 2.89% for £2,200 is £63.58, leaving a net benefit of £447.48
3. Effective interest rate of Credit Cards bearing interest in August 2010 according to the Bank of England
|
Credit Card
|
BT 0% Period (months)
|
BT handling fee
|
Typical APR variable
|
|
Virgin Money Credit Card
|
16
|
2.89%
|
16.8%
|
|
MBNA Platinum Card
|
16
|
2.90%
|
16.8%
|
|
Barclaycard Platinum Card
|
16
|
2.90%
|
16.9%
|
|
Clydesdale Bank Gold Card
|
16
|
2.90%
|
16.9%
|
|
Yorkshire Bank Gold Card
|
16
|
2.90%
|
16.9%
|
|
NatWest Platinum Card
|
16
|
2.90%
|
16.9%
|
|
Royal Bank of Scotland Platinum Card
|
16
|
2.90%
|
16.9%
|
