Compare credit cards with low interest on purchases for at least 6 months

Find a credit card that best suits your needs. Compare interest rates, balance transfer rates, annual fees and more from Australia's leading lenders, big and small. - Data last updated on 22 Jul 2019

Compare 6 month low interest credit cards

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When it comes to credit cards, everyone is looking for the best deal. Credit cards with low interest on purchases for at least six months can be an attractive option for many customers.

But it’s important to be aware of the restrictions. We’re going to look at credit cards with temporary low interest rates so you understand their benefits and shortcomings before signing up.

What is credit card interest?

Credit card interest is the extra amount of money you pay a credit card provider to cover the cost of borrowing the funds.

As a credit card holder, you’re may have to pay interest on the money you owe, and the quicker you pay it off, the cheaper it is.

You can choose credit cards with low interest rates or credit cards with high interest rates, and there are advantages and disadvantages with both.

For instance, a credit card with a low interest rate would theoretically be easier to pay off, but a credit card with a high interest rate might offer attractive perks and bonuses.

What are the different types of credit card interest?

Anyone who is in the market for a new credit card needs to be aware of the different types of credit card interest, and have a sense of the charges these may incur:

  • Purchase interest – This is interest charged on purchases you make with your credit card, which may exclude cash withdrawals and similar transactions.
  • Balance transfer interest – This is the interest rate added onto any outstanding amount if you’re transferring your balance from an old credit card to a new credit card.
  • Cash advance interest – This is the interest rate that applies to any cash withdrawals with your cards. It may include ATM withdrawals, gambling transactions and bill payments, although this depends on the agreement between the biller and the bank.

How do credit cards with low interest on purchases work?

Many credit card providers have introductory offers, designed to attract customers and make their cards stand out from the competition. An example of this is credit cards with low interest on purchases for at least six months. These cards offer lower interest rates during the introductory period, before ramping back up to the standard rate. While this can seem like an enticing deal, it’s important to be wary of the level the rates will rise to, once the honeymoon period is over.

What happens once the low interest promotion has expired?

Once the credit card low interest promotion has finished, you’re required to cover any outstanding balance at the standard interest rate, which is generally much higher than the one advertised in the promotion. If this amount is not paid quickly, it can quickly snowball into a high level of debt.

What are the pros and cons of credit cards with temporary low interest?

When you’re comparing credit cards with low interest on purchases, it’s important to consider the pros and cons of these financial products before signing the dotted line.

Pros

  • Potentially a cheaper way to borrow money – Credit cards with low interest on purchases can be a good way to purchase major items like appliances, furniture and electronics if you don’t have the cash to pay up front.
  • Allows you to pay down balances faster – Credit cards with temporary low interest rates give you the potential to pay off a balance faster.

Cons

  • It’s a temporary offer – Perhaps the biggest sticking point about credit cards with low interest on purchase for at least six months is the fact that this rate is temporary. Once this rate has expired, you will have to pay off interest at the standard level.
  • The offer could be forfeited – If you’re looking to take advantage of a credit card with a temporary low rate, it’s important to remember that the offer could be forfeited if you make late repayments. To get full value of the low-interest-rate credit card, it’s important that you are able make all your credit card repayments in a timely manner.
  • Other fees to be aware of – Just because you’ve got a temporary low interest rate, it doesn’t mean you’re not getting slugged fees somewhere else. When signing up to a low-interest-rate credit card, make sure you are aware of any annual fees, monthly maintenance fees, balance transfer fees and past due payment fees, as these can add up over time.

^Words such as "top", "best", "cheapest" or "lowest" are not a recommendation or rating of products. This page compares a range of products from selected providers and not all products or providers are included in the comparison. There is no such thing as a 'one- size-fits-all' financial product. The best loan, credit card, superannuation account or bank account for you might not be the best choice for someone else. Before selecting any financial product you should read the fine print carefully, including the product disclosure statement, fact sheet or terms and conditions document and obtain professional financial advice on whether a product is right for you and your finances.

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