You could use a money transfer credit card pay off a stubborn overdraft or get an interest free cash loan. Money transfer cards offer 0% interest periods for transferring money from your credit card to your current account. Compare money transfer cards from 3 companies below.
uSwitch Limited is a credit broker, not a lender, for consumer credit products.
uSwitch services are provided at no cost to you, but we may receive a commission from the companies we refer you to.
A money transfer card enables you to transfer money from your credit card to bank account, effectively giving you a small cash loan.
A credit card money transfer works in a similar way to a balance transfer credit card, only it transfers money into your bank account instead of to your credit card. You are then in debt on your money-transfer card, however the best money transfer cards have 0% interest periods lasting over two years.
Although you will have to pay a fee to transfer the money, which will be around 1% to 3% of the money transferred.
You can use it to pay off overdrafts that are becoming expensive or to get cash to make a purchase that requires cash, rather than credit. You can also use the money from your current account to pay off loans that have high interest rates.
The 0% interest period on money transfer credit cards allows you to put-off paying interest on your debt, if you can pay back the balance before the interest-free period expires you can avoid paying interest all-together.
Money transfer cards usually trade off the length of the interest free period against the transfer fee, so the longer the 0% period the bigger the transfer fee and vice versa.
So it’s worth working out what’s better for you. Whether a lower transfer fee for a shorter interest free period could save you more money than a longer time spent not paying interest largely depends on how long it will take you to pay off the debt.
If you think you can pay off the debt in a shorter time you’d be better off going for the cheaper transfer fees.
Also, bear in mind that most money transfer cards do not offer interest free purchases for the same period as the 0% balance transfer period.
For example, let’s say you have a debt of £1500. An APR of 20% will add £25 a month onto the debt (or £300 a year). Transferring money from a card for a one-off 3% fee will cost you £45, you can then have a holiday from paying interest for between three months and two years.
Credit card transfers can be an effective way of borrowing small amounts of money over the short term without paying interest. However, typically you will need a good credit rating and make sure to meet the minimum repayments.
If you do not repay the card before the interest-free period expires you will be charged the full interest on your remaining debt.
We compare credit over 100 credit cards from all of the major banks and credit card providers.
However, we do not compare all the credit cards that are available in the UK.
This is because some credit card providers have offers that are only available exclusively through their own website or branch, or through other comparison websites - in the same way some credit cards are exclusively available through uSwitch.
There are also many credit cards that are only available to people in member organisations and clubs.
We sometimes receive payment from card providers to display their cards in prominent locations.
These are adverts and are designed to be distinct and separate from the other cards on our comparison tables. We hope this makes it clear which cards are top-of-table deals and which cards are paid for promotions.
You can get a credit card for a wide range of uses, far beyond the basics of simply making purchases and paying for them later. You can use credit cards to help pay off other debts using balance transfer or money transfer credit cards, or you can use them to collect rewards and even cashback. […]
The application for a credit card is usually done online and can be completed in less than five minutes, but the approval process is likely to take a lot longer. However, the time it takes to approve a credit card can often depend on the provider’s own online system, and your credit score, as you […]
One of the benefits of paying for goods with a credit card rather than with cash is that your purchases are protected by law. This means if for some reason your goods are faulty, damaged or were never delivered to you, then you should be able to claim the money back via your credit card […]
The market for borrowers with poor and limited credit history has been historically led by a limited number of cards with high cost of credit. But is the market for bad-credit and credit-builder credit cards getting better? What are bad-credit and credit-builder cards? These are credit cards aimed at those with poor or limited credit […]
Time was, store cards were regarded with suspicion by savvy consumers, as these cards traditionally offered high rates of interest, limited benefits and were seen as a way to hook customers in. But, in recent years many retailers have formed banking wings, and so have credit cards not only with strong credit offers, but also interesting […]
Summer has come to an end, and many of us might have overspent on our holidays or whilst enjoying the sun at home. So if the brisk September breeze has put an end to your summer dreaming and you’re looking at your card balance with a worried expression, a balance transfer card could help. We’ve […]
Getting into unsustainable debt is frighteningly easy – a few months of irresponsible spending can land you with a debt of tens of thousands that could take years to pay back. Most people experience problem debts at some point in their lives, and it can be difficult to get the situation back under control. Many people borrow money […]
Use this guide to find essential information about how to get out of debt, including ways to reduce debt and how to get help if you’re having debt problems. If you’re starting to feel overwhelmed by your debts, you’re unable to pay them off, or there’s an increasing risk of being taken to court by the people that you […]
Debt consolidation loans are one way of dealing with overwhelming debts – read our guide to learn more What is loan consolidation? – Loan consolidation is borrowing one large loan to pay off all your other loans Is a debt consolidation loan right for me? – If you are struggling to meet your current monthly […]