Credit card providers chasing business with 0% balance transfer offers

Credit card providers chasing business with 0% balance transfer offers

Gone a bit hard on your credit card lately? If so, an interest holiday of 18 months might be just what you need to finally clear that debt.

“But how is that possible?” we hear you ask.

The answer is a ‘balance transfer’, which allows you to switch your debt from one credit card to another – and can also give you an interest holiday in the process.

Not all credit cards allow balance transfers. And not all balance transfer offers include an interest-free period. Some, though, will freeze repayments on your existing debt (but not any new debt you accumulate) for a certain period.

For example, there are more than 10 institutions that allow consumers to transfer their credit card debt without paying any interest on that debt for at least 18 months:

  • ANZ
  • Bank of Melbourne
  • BankSA
  • Bankwest
  • Bendigo Bank
  • Citi
  • HSBC
  • Qantas Money
  • St George Bank
  • Suncorp Bank
  • Virgin Money
  • Westpac

(For more details, see the table at the bottom of this article.)

Balance transfer options

There are almost 100 credit cards on the RateCity website that offer 0% balance transfers. However, only a small portion of these offer 0% balance transfers for at least 18 months.

How to get the most out of balance transfers

When making balance transfers, there are several potential traps to be aware of:

  • Most credit card providers won’t allow you to transfer your entire debt
  • Many credit card providers charge a balance transfer fee
  • The interest-free period applies only to old debt (not any new debt you accumulate)
  • Unless you cancel your old credit card, you will now have two cards
  • Many credit card providers charge an annual fee

To get the most out of a balance transfer, you might wish to:

  • Pay off the entire debt during the interest-free period
  • Cancel your old credit card as soon as possible
  • Avoid spending on either your new card or your old card

You might also wish to cancel the new credit card once the entire balance transfer debt has been repaid. That way, you won’t be able to run up any more credit card debt.

Credit cards – the key numbers

The average interest rate of the approximately 200 credit cards on the RateCity database is 16.78%. The average annual fee charged by those cards is $134.60, while the average number of interest-free days they offer is 51.

Compare Australian balance transfer options

Ready to compare balance transfer credit cards?

Here are some credit cards that offer interest-free periods of at least 18 months for any debt you transfer as part of a balance transfer:

Provider Product BT rate BT fee Annual fee
Citi Platinum (Balance Transfer Offer) 0% for 26 months 1.5% $0 for 12 months, then $199
Bankwest Breeze Mastercard 0% for 26 months 2% $0 for 12 months, then $79
Bank of Melbourne Vertigo Platinum 0% for 26 months 2% $0 for 12 months, then $99
BankSA Vertigo Platinum 0% for 26 months 2% $0 for 12 months, then $99
St George Bank Vertigo Platinum 0% for 26 months 2% $0 for 12 months, then $99
HSBC Platinum Credit Card 0% for 22 months $0 $129
HSBC Low Rate Credit Card 0% for 20 months 2% $79
Virgin Money Virgin Australia Velocity Flyer Card (Ongoing Annual Fee Offer) 0% for 18 months $0 $50
Westpac Low Rate Card 0% for 18 months $0 $59
Virgin Money Virgin Australia Velocity Flyer Card (Bonus Points Offer) 0% for 18 months $0 $64 for 12 months, then $129
Suncorp Bank Clear Options Platinum Credit Card (Suncorp Bank Rewards) 0% for 18 months $0 $129
Qantas Money Qantas Premier Platinum 0% for 18 months $0 $149 for 12 months, then $299
Suncorp Bank Clear Options Platinum Credit Card (Qantas Rewards) 0% for 18 months $0 $178
ANZ Platinum 0% for 18 months 2% $0 for 12 months, then $87
ANZ First 0% for 18 months 2% $30
Bendigo Bank Low Rate Mastercard 0% for 18 months 2% $45

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Learn more about credit cards

What is a balance transfer credit card?

A balance transfer credit card lets you transfer your debt balance from one credit card to another. A balance transfer credit card generally has a 0 per cent interest rate for a set period of time. When you roll your debt balance over to a new credit card, you’ll be able to take advantage of the interest-free period to pay your credit card debt off faster without accruing additional interest charges. If your application is approved, the provider will pay out your old credit card and transfer your debt balance over to the new card. 

How to pay a credit card from another bank

Paying or transferring debt from one lender to the other is called a balance transfer. This involves transferring part or all of the debt from a credit card with one lender to a credit card with another. As part of the process, your new lender will pay out the old lender, so that you now owe the same amount of money but to a new institution.

Many credit card providers offer an interest-free period on balance transfers to help new applicants better handle their debt. During this period, cardholders are not required to pay interest on the debt they brought over from the other card. This can be a great opportunity for consumers to pay off credit card debt with no interest. There are often fees associated with balance transfers; normally, these are a percentage of the amount transferred.

So make sure you read the terms and conditions of the card before transferring any debt across.

Can I transfer money from my American Express credit card to my bank account?

If you’re an American Express credit card customer, you may not be able to transfer money from your credit card to your bank account. However, you may be eligible for cash advances, which involves withdrawing money through an ATM. 

To qualify for a cash advance, you’ll likely have to enrol for American Express Membership Rewards. Consider checking your online credit card account to see if you can withdraw a cash advance and, if so, the fees and charges you’ll incur for this transaction. 

You should remember that cash advances are different from balance transfers, which were available with some American Express credit cards earlier. Balance transfers allow customers to consolidate debt from high-interest credit cards to a credit card offering a lower interest rate. If you only recently applied for an American Express credit card, balance transfers may not be available irrespective of the card you own. 

How do you cancel a credit card?

It’s important to cancel your old cards to avoid any additional fees. Unless you’re doing a balance transfer, you’ll need to pay the outstanding balance before you cancel your credit card. If you’ve opted for a card with reward points, make sure you redeem or transfer the points before you close your account. To avoid any bounced payments and save yourself an admin headache, redirect all your direct debits to a new card or account. Once you’ve done all the preparation, call your bank or credit card provider to get the cancellation underway. Once you receive a confirmation letter, destroy your card and make sure the numbers aren’t legible.

How do you use credit cards?

A credit card can be an easy way to make purchases online, in person or over the phone. When used properly, a credit card can even help you manage your cash flow. But before applying for a credit card, it’s good to know how they work. A credit card is essentially a personal line of credit which lets you buy things and pay for them later. As a card holder, you’ll be given a credit limit and (potentially) charged interest on the money the bank lends you. At the end of each billing period, the bank will send you a statement which shows your outstanding balance and the minimum amount you need to pay back. If you don’t pay back the full balance amount, the bank will begin charging you interest.

What should I do if my ANZ credit card has expired?

Your ANZ credit card is considered expired only after the last day of the month and year marked on your card. For instance, if your card’s expiry date reads 03/22, it is valid until 31 March 2022 and expires on 1 April 2022. Typically, you should have received a new credit card by that date, and you won’t have to request a new card. 

Once you get the new card, you should remember to switch any automatic payments you have - such as a utility or mobile phone bill - from your expired credit card to your new credit card. Equally, if you are using CardPay Direct to repay your ANZ credit card debt, you may need to update the credit card account details for that service as well. 

In case the new card doesn’t arrive by the expiry date of your current credit card, you can call ANZ on 13 22 73 to find out the reason and if you need to request an expedited card. Please note that if you were planning to close your credit card account or request a credit card upgrade, you may need to call ANZ at least before the 25th of the month your current credit card expires in, as that’s when they may send you the new credit card.

How is credit card interest charged?

Your credit card will be charged interest when you don’t pay off the balance on your credit card. Your card provider or bank charges you the individual interest rate that is associated with your card, which is usually between 10 and 20 per cent. 

The interest will be added onto your bill each month or billing period if you don’t pay off the balance, unless you are in an interest-free period.

You will be charged interest on anything that hasn’t been paid for inside the interest-free period. Usually you will receive a notice on your bill or statement saying you will be charged interest so you have some form of notice before you’re charged.

Can a pensioner get a credit card?

It is possible to get a credit card as a pensioner. There are some factors to keep in mind, including:

  • Annual income. Look for credit cards with minimum annual income requirements you can meet. 
  • Annual fees. If high fees are a concern for you, opt for a card with a low or $0 annual fee. 
  • Interest rate. Make sure you won’t have any nasty surprises on your credit card bill. Compare cards with a low interest rates to minimise risk.

How do you apply for a credit card?

You can apply for a credit card online, over the phone or in person at the bank. Once you’ve compared the current credit card offers, the application process is quick and easy. Before you get your application started, you’ll need to gather your personal information like proof of ID, payslips and bank statements, proof of employment and details of your income, assets and liabilities. To be eligible for a credit card, you’ll need to be an Australian citizen over 18 and earn a minimum of $15,000 each year. Once you’ve applied for a credit card, you should get a response fairly instantly. If your credit card application has been approved, you should receive a welcome pack with your new credit card within 10-15 days.

How do I transfer money from my Commonwealth bank credit card to my bank account?

Your Commonwealth bank credit card may include a cash advance benefit, but you won't be able to transfer money to your bank account. 

You can, however, withdraw cash from your credit card at an ATM. You should remember that you have to pay a fee for such transactions, and you’ll be charged interest from the day you withdraw the cash. 

Unlike other credit card transactions, you don’t get an interest-free repayment period for cash advances. Also, you may not be able to access your full credit card limit for a cash advance.

Should I get a credit card?

Once you've compared credit card interest rates and deals and found the right card for you, the actual process of getting a credit card is quite straightforward. You can apply for a credit card online, over the phone or in person at a bank branch. 

How do you use a credit card?

Credit cards are a quick and convenient way to pay for items in store, online or over the phone. You can use a credit card as a cashless way to pay for goods or services, both locally and overseas. You can also use a credit card to make a cash advance, which gives you the flexibility to withdraw cash from your credit card account. Because a credit card uses the bank’s funds instead of your own, you will be charged interest on the money you spend – unless you pay off the entire debt within the interest-free period. If you pay the minimum monthly repayment, you will be charged interest. There are many different credit card options on the market, all offering different interest rates and reward options.

How to increase ME Bank credit card limit?

If you want your  ME bank credit card limit increased, you’ll have to fill the “credit card limit increase request form” and send it to the bank via post, email, or fax. The requirements for increasing the credit limit include:

  • You should have the card for at least six months;
  • Your income has increased; and
  • Your debt liabilities have decreased.

How to get rid of credit card debt

  1. Calculate your debt. Credit card calculators make it easy to determine the repayments required to chip away at your debt in the shortest timeframe possible for your budget.
  2. Repayment plans. Take some time to formulate a credit repayment plan. Consider increasing your income, scaling back your lifestyle or refinancing.
  3. Talk to your credit provider. If you’re still struggling with your debt, give your credit provider a call. You may be able to come to a new arrangement.