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Clear your overdraft with a 0% card

Facing hefty overdraft charges? Give yourself some breathing space with an interest-free money transfer credit card.

The average current account overdraft charges customers 16.7 per cent interest a year.

This means you can end up severely out of pocket if you’re constantly overdrawn.

Plus some banks impose extra fees - Halifax, for example, charges current account holders £1 a day if they are in the red.

These costs can soon add up and are less than ideal if you’re struggling to sort out your finances.

Money transfer credit cards

But there is a type of credit card that could help.

These let you transfer credit to your current account - a transaction known as a money transfer - giving your bank balance a boost and lifting you out of your overdraft.

You then get a 0 per cent period in which to pay off the sum interest-free.

Card providers charge a fee for this, typically around 4 per cent of the amount you’re transferring.

But if paying this fee still means saving money on the interest you’re paying servicing your overdraft, then it is definitely worth considering.

How these cards are different

Nerys Lewis, head of credit cards at, explains how money transfer deals differ from other types of plastic.

She says: "If your current account needs a cash injection, then a money transfer can be a great way to help you out.

"Most credit cards would class this type of transaction as a ‘cash advance’ – which can attract interest rates of 30 per cent or more from day one.

"Plus cash advance fees can be around 3 per cent, so we’d never recommend you do this.

"But with a money transfer credit card you can clear your overdraft without being hit by sky-high charges, giving you breathing space to pay off the balance interest-free."

Fluid credit card offers 26 months interest-free

One of the top options for money transfers is the Fluid credit card.

This card allows you to transfer money to your current account interest-free for 26 months - the longest 0 per cent period on the market.

Fluid charges a 4 per cent handling fee – but for this you get more than two years in which to pay off the balance without being charged interest.

Lewis explains some of the extra benefits of this credit card.

‘Apply with Confidence’

"The Fluid credit card has a nice feature called ‘Apply with Confidence’," she says.

"This lets you pre-check your likelihood of acceptance before you fully apply.

"Not only does this save you time by knowing you’re unlikely to make a wasted application, but it protects your credit rating from a failed application."

Other top picks

There are a number of credit cards that offer 0 per cent money transfer deals.

So we’d recommend you compare different ones before applying.

The MBNA everyday credit card, for example, offers 0 per cent on money transfers for 18 months for a 4 per cent handling fee.

While the AA credit card offers 0 per cent for 16 months on all money transfers - again, for a 4 per cent fee.

‘You’ll need to be disciplined’

Before you make your application, Lewis adds a word of caution.

"If you haven’t paid off your debt within the 0 per cent period, you’ll start paying interest unless you can transfer it to another interest-free card.

"You'll also need to be disciplined and make sure you pay off the balance that’s been transferred and not simply spend more and dip back into your overdraft."

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Adam Jolley

Adam Jolley

Adam Jolley is a content producer at He joined us in May 2012 from the world of financial services PR.

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