Spotlight On: First direct balance transfer credit card

Kate Hughes
Saturday 03 September 2011 00:00 BST
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The deal

First Direct has joined the pack offering long interest-free periods with a 20-month 0 per cent balance transfer credit card.

The good points

This is one of the longer interest-free transfer periods on offer, with a typical APR of 16.9 per cent comparing favourably to other cards offering the same 20-month deal.

The bad points

Like so many of these balance transfer deals, the handling fee is 2.9 per cent, which means a painful upfront charge of £87 if you transfer £3,000.

Conclusion

The credit card market remains locked in a race to the longest interest-free balance transfer deal, with an average of 12.5 months now the norm – up from 9.5 months this time in 2009. Today, 22 and 24 month deals are not unheard of, but consumers should look past the headline rates to calculate the real costs should they fail to pay off the balance before the period ends. And be prepared for the transfer fee hit that will immediately increase your debt. Make sure it's worth it if you'll pay it off quickly.

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