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Balance transfer cards – Are they really worth it?

Bought your Christmas on credit? We explain how you could avoid hundreds of pounds in interest charges.

BT_card_comparison (1)

An estimated 17 million Brits bought their Christmas presents on a credit card last year, with 10 million putting their Christmas dinner on credit too.

Christmas 2014 could soon generate some hefty interest charges if it isn’t paid off, but these could easily be avoided with a balance transfer card.

Fierce competition in the balance transfer market now means that you could avoid interest on your card balance for almost three years – the longest it’s ever been.

How much could I save with a balance transfer card?

The average household 2014 Christmas spend was £821, according to YouGov. Over 35 months this could cost £542 in interest charges (if only the minimum £5 repayments were met on a typical credit card charging 18.9% APR).

How much your card balance will cost depends on how long it’s going to take you to pay it back. Balance transfer cards tend to trade off longer 0% interest periods against lower transfer fees: the shorter the 0% period, the lower the transfer fee.

If you think you could pay it off in a few months or under a year your debts could actually cost you nothing at all.

We’ve compared the cost of £821 in credit on four different balance transfer cards, as well the cost of keeping the balance on an old card charging 18.9% APR, over 35 months:

BT cost

Tesco no-fee BT card (12 months 0% interest, 0% transfer fee, 18.9% APR), Santander 123 card (23 months 0% interest, 0% transfer fee, £24 annual fee, 16.5% APR), MBNA everyday card (21 months 0% interest, 1.5% transfer fee, 15.9% APR), Barclaycard platinum BT card (35 months 0% interest, 2.49% transfer fee, 18.9% APR)

The longest 0% period ever

The Barclaycard Platinum 35 Month Balance Transfer Visa leads the market with the longest available 0% interest period for a balance transfer.

You can effectively defer paying any interest on your debts for almost three years.

However, there is a 2.49% fee to transfer your balance so transferring £821 would cost you around £20 in fees. After that, provided you meet the minimum monthly repayments, your debt will not cost you anything for 35 months.

MBNA everyday card:  low fee, low interest

The MBNA everyday credit card is a solid all-rounder card, offering 21 months of 0% interest on balance transfers, as well as 15 months 0% interest on purchases.

The balance transfer fee is relatively low at 1.5% meaning it will cost £12 to transfer a balance of £821. The APR is also quite low at 15.9%, so it doesn’t shoot up too fast after the 0% period expires, costing you £153 over 35 months.

Santander 123: is the annual fee worth it?

Santander’s 123 Credit Card MasterCard is probably the most versatile card currently on the market.

It offers 23 months of 0% purchases and balance transfers with a 0% fee. The card also offers some of the most competitive cashback in increments of one, two and three percent depending on where you spend (hence the ‘123’ name).

The only catch is that these benefits come with a £24 annual fee, but this is waived if you have a 123 Current Account with Santander. This means any balance will cost you £48 over the course of 23 months until the 16.5%APR kicks in.

Over 35 months, a £821 balance will cost you £206, assuming the £5 repayments. But if your fee is waived, your balance transfer will be completely free for almost two years.

Tesco credit card: money for nothing?

The No Balance Transfer Fee Tesco Clubcard Credit Card is the only entirely “fee free” card available, but after twelve months the interest quickly shoots up to 18.9% APR. This means £821 could end up costing £307 over 35 months if you meet only the minimum repayments.

If you think you can pay off your balance in under a year this is the cheapest way to manage your debt. But if you can’t, it can soon become the most expensive.

Compare balance transfer cards

The consumer credit market is becoming increasingly competitive as we move into 2015, with cheaper cards and better deals rolled out at the end of last year and in January, so keep an eye open to check for great new card deals.

There are a lot of balance transfer cards available to suit a wide variety of circumstances, it’s well worth comparing all balance transfer cards to find the best balance transfer card for your needs.

To find out more you can read our guide on balance transfer cards.


  • Chris

    Over the top statement, trying to scare monger the public into changing supplier, so USWITCH make money on the switch. All those percentages are taken out of context to mislead the average person into doing this!.

    • lee

      Even if you get the advice from uswitch you don’t have to agree to them doing the switch for you – that is totally your choice. Instead, you can just get uswitch to give you all the information, you write it all down and then you contact the new supplier you want to switch to with that information. You can do it all yourself and then uswitch don’t make a penny. Sometimes if you switch through one of the cashback websites you can even make money by switching, e.g. £50, by switching it yourself. I have saved a fortune by using the uswitch service, so I don’t begrudge uswitch the very small amount that they have made on each switch that they have arranged for me. It’s not as if I pay them direct for providing me with all the information – that is totally free. They only charge the energy companies a very small amount when you ask uswitch to arrange the switch for you. Yes, I know that the cost eventually gets passed onto the consumer, I.e. me, but it really only makes a miniscule amount of difference to the amount you pay for your energy. It is the energy companies that are the crooks, not uswitch. Switching is not hard and it is everyone’s right to pay as little or as much as they want to for their energy, but shopping around without the help of a company like uswitch is extremely difficult and very time consuming. All uswitch is offering you is information and a way of making it very easy to switch suppliers. What do you expect them to run their business on – fresh air?

  • Chris

    Also, If you are overcharged with an estimated reading, with the recent trend of price rises over and over again, you’re better off staying with your supplier. At least you’re being overcharged at the older cheaper prices. When an actual reading is taken to catch up with this over estimate. You’ll be paying for less units at the newer more expensive price!

  • diane1606

    it doesn’t make the slightest bit of difference…after 3 years of making phone calls, even having to endure being put on hold at my own expense (0845) for up to half an hour at a time, DOZENS of times, trying to sort THEIR errors out, being threatened with bailiffs, etc, and that is after the company admitted to having read someone else’s meter by mistake, and adding that reading to My account, I am STILL being threatened with court action if I don’t pay an entirely incorrect bill which was over £800 for gas/electricity july 22nd to sept 4th for a 3 bed semi where me and my daughter were the only people living there, but then only overnight, as we both worked full time+, and we had only just moved in, so hadn’t even worked out how to put the heating on….as it was the height of summer! I don’t know what YOU think, but >£800 is a bit steep for 5-ish weeks in summer, no heating, not much in the way of lighting, 3 bed semi?? Bizarre! I’m still refusing to pay…have worked out I owe them about £124 only…’s a long story..maybe I should just go to court, it would probably be a lot simpler?

    • Peter

      By sending a written notice that you intend to sue them at a rate of £350 a day you then invite them to take you to court with your counter claim and by not taking court action they agree that your claim to compensation is valid this should get them responding

      • diane1606

        Thank you Peter…£350 a day for 4 might be worth the hassle!

    • Lee

      contact dominic littlewood off the tv from “Don’t get done, get Dom” and see if he can help you. it’s totally worth a shot and you have nothing to lose.

      • diane1606

        Lee…I had a rare “day off” recently, spotted that programme in the morning, wondered if it might be worth a try! Thanks!

    • Terry

      As long as you have all the proof then let them take you to Court. They will lose and have to pay for it.
      You could take it to the ombudsman instead though at let them sort it out. You have a right after not getting it sorted after all this time.

      • diane1606

        Thank you Terry. To be honest it is still ongoing…their last communication was that I owed them, I think, about £260…a completely random amount, no meter readings involved, I dare say to placate me and lure me into paying..rather less than the original £800+, but still more than I actually owe…I’ve not heard from their “debt collectors” for a while, but I guess they’ll try again soon…!

  • Lorna

    I live in a four bedroom detached farmhouse with my husband and kids. We only have electric storage heating. Two years ago when we moved in our supplier said £200 per month would cover the electricity useage. When I got the first bill after being there six months I was well in credit, fantastic as it was approaching winter and I knew we would be using more electric. Six months later my next bill arrived, I was over £1000 (yes one thousand pounds, not a typo) in debt! Panic hit so I called my energy supplier, my advice was that it would all even out over summer. Six months later my new bill arrives and despite NEVER missing a Direct Debit my bill shows I’m £2700 (two thousand, seven hundred) in debt!!! My Direct Debit has now been increased to £400 per month and it’s just about financially crippling us. I’ve contacted the Energy Savings Trust, the Government have no grants available to update electric heating, only gas or oil! Energy prices are still rising, I cannot change supplier beacause of the debt and the duel meter that is installed. I’m at my wits end! It’s not just energy prices that are going up, everything is apart from our income. I fear that soon it will be a choice between food or warmth, although we are lucky, I know there are people out there in a far worse position than us. NOTE; None of the bills were estimates.

    • john

      Take them to court with a counterclaim to include compensation

      • lee

        Are you sure the meter is working properly. You can ask the energy company to get an independent person to check it is working properly and get them to prove to you that I has been working properly the entire time.

  • djstephen

    I am with Scottish Power, Since the 1st June 2013, I elected to pay my bills, not by direct debit. The problems I have encountered with them is unbelievable.Several e mails and two phone calls and the problem has not been sorted to my satisfaction.

  • lee

    All I can say is always check your BT bills, because practically everyone that works at BT lies, especially the sales team and the overseas call centres, and because of the way their entire system is set up when you phone back again to find out what is happening with your complaint they deny all knowledge. Put every complaint to them in writing and do it through the official complaints channel detailed on their website, even if they tell you it is okay to complain in a phone call (don’t believe them, they lie.) I am also going to write to the CEO because he has to be told what is happening within the company and I am certain he has no flippin’ idea or he would be ashamed to show his face. I’ve even had BT staff phone my house and provide me with fake contact names, fake job titles and even fake departments in response to my complaints.

  • britnee

    hi, we are offering you 100% free solar panels installations on your roofs. you need not to pay any single pound or any thing. its free 100%. also you can use electricity free rest of your life. if you are happy and wanna panels and use electricity free just mail me at

  • Paul Hinkley

    if the energy company has overcharged that to me is organised theft do I get my money back and get them charged and have compensation paid to me I do not think so if I did this to a customer and deliberately did this I would be locked up different rules for the rich and those who are entrusted with our powers they manipulate the system for themselves

  • swardy

    HI,I am currently paying £10 a day gas on a meter and i am only in at night. Am i paying to much? and what do i do if so.

  • JamesWH

    I have only just discovered I am wrongly being charged for using my emergency credit on prepayment, that is to say I am being charged at an unkown rate for using the emergency which isn`t taken from the emergency credit but added to debt owed screen on the meter which means each top up I make to get myself out of emergency is not far from double the amount of the emergency credit I have used. It has been like this for a year, as a result I have been opting to live without heating and just use my gas for heated water only as I am on benefits – does anybody know if I can claim compensation for the hardship I have faced because of this? After all this has had a snowball effect since day one ie I can only afford a small amount of credit while on benefits and therefore regardless of the fact I have been in credit each payday(fortnightly) I am always forced to enter into emergency credit on a regular basis and as I get charged more than I can afford to pay out of my budget every couple months I have to cut back on electric use so as to recover the difference so that I can keep clean and wash my dishes. On many occasions I have had to go without baths(I have been getting just 1 a week otherwise) and also had to take risks with my health by washing dishes in cold water. I haven`t even checked if this is case with my electric yet but its in hand.

  • Angela Greenfield

    I have just found out that Scottish Power reckon I owe them £1,400. As my energy usage has not increased and the cost of my usage for the last 3 months (the time when I have my heating on the most) is only around £200, I know this is wrong. They are claiming they have not had a reading for two years, yet I have sent readings online and in the post. They now want to increase my monthly payment to £150 until the balance is cleared and are completely refusing to admit that there is a mistake. According to them I have used over £2,000 worth of gas in the last year. Can anyone advise on if there is anything I can do about this please.