The UK’s biggest building society, Nationwide, will scrap its £12 fee for credit card customers who spend more than the agreed limit from Friday, 1 May.
It will also no longer charge interest on Nationwide balance transfer card spending that is paid off within the month.
The move is part of a review Nationwide is conducting into the way it treats its customers.
How the credit card spending limit works
A credit card will allow you a spend limit, typically around £1,000 – £2, 000, but if you accidentally spend more than your limit, even by £1, you will be hit with a one-off charge.
This is similar to the charge you may receive for going over your overdraft limit on a current account.
However, Nationwide customers no longer have to worry about this from this Friday.
How the balance transfer change works
Balance transfer cards offer no interest charges on any balances transferred across, although there is typically a transfer fee.
However, any additional spending on balance transfer cards typically accrues interest, even if you pay back the additional spending.
Nationwide has agreed to no longer charge customers interest on additional balance transfer card spending, as long as it’s paid off within the month.
This could potentially save their customers a great deal of money on interest charges
For example, if you spent £100 each month on a Nationwide balance transfer card charging 17.9% APR on spending, it would have cost you £214.90 over the course of a year (even if you fully paid back the additional spending), now it will cost you nothing (provided you repay the spending).
Balance transfer cards – Compare a huge range of balance transfer cards, including Nationwide.
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