Low Interest Rate Credit Cards

Enjoy low interest rates when you carry a credit card balance and save money on your repayments.

A low rate credit card is designed to help you save money on purchases and existing card debt by charging less interest than other credit cards. If you don’t pay your card off in full each month, a low rate card helps keep your interest charges to a minimum. Switching to a card with a lower interest rate can also help you pay off your debt faster. Use this guide to learn how low interest rate cards work and compare the features and offers available to find the right low rate card for your needs.

There are plenty of 0% deals available – on balance transfers or forthcoming purchases (or both). These cards offer a rate of 0% for a set period, after which a much less competitive “revert rate” kicks in. Use the links below to compare these types of card, or compare cards with low ongoing rates using the table below.

Compare low rate credit cards

Comparison ordered by representative APR with affiliated products shown first.
Updated June 16th, 2019
Name Product Purchases Balance transfers Annual/monthly fees Rep. APR Incentive Representative example
9.9%
6.9%
£0
9.9% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 9.9% (variable) p.a., your representative rate is 9.9% APR (variable).
9.9%
N/A
£0
9.9% p.a. (variable)
Earn 2,500 bonus Membership Rewards points when you spend £1,000 in your first 3 months, and 1 point for virtually every £1 spent thereafter.
Representative example: When you spend £1,200 at a purchase rate of 9.9% (variable) p.a., your representative rate is 9.9% APR (variable).
9.9%
6.9%
£0
9.9% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 9.9% (variable) p.a., your representative rate is 9.9% APR (variable).
0% for 1 months reverting to 5.94%
0% for 1 months reverting to 6.054%
£0
5.9% p.a. (variable)
1 point per £4 spent (£4 minimum) in Tesco and 1 point per £8 spent (£8 minimum) outside Tesco. Must have available credit to earn points. Points are converted to Tesco vouchers or can be exchanged for Partner rewards to receive money off a variety of restaurants, entertainment or Avios points.
Representative example: When you spend £1,200 at a purchase rate of 5.94% (variable) p.a., your representative rate is 5.9% APR (variable).
6.45%
6.45%
£0
6.4% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 6.45% (variable) p.a., your representative rate is 6.4% APR (variable).
6.45%
6.4% for 3 months reverting to 6.45%
£0
6.4% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 6.45% (variable) p.a., your representative rate is 6.4% APR (variable).
6.45%
6.45%
£0
6.4% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 6.45% (variable) p.a., your representative rate is 6.4% APR (variable).
6.9%
6.9%
£0
6.9% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 6.9% (variable) p.a., your representative rate is 6.9% APR (variable).
4.9% for 48 months reverting to 8.9%
4.9% for 48 months reverting to 8.9%
£0
8.9% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 8.9% (variable) p.a., your representative rate is 8.9% APR (variable).
9.9%
6.9%
£0
9.9% p.a. (variable)
Representative example: When you spend £1,200 at a purchase rate of 9.9% (variable) p.a., your representative rate is 9.9% APR (variable).

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What is a low interest rate credit card?

Low interest rate cards offer a much lower interest rate for purchases than standard credit cards. While credit cards in the UK typically have interest rates that range from 12% to 30% per annum, low rate cards offer standard variable rates as low as 6% p.a. Some cards even offer promotional 0% rates on purchases for a fixed period (you can learn more about these in finder’s guide to 0% purchase credit cards).

A low rate credit card makes sense if you regularly pay with plastic and know you won’t always pay off the balance in full each month. It gives you the flexibility to pay off your balance over time, without the higher interest charges of some other cards.

But if you have a large existing credit card debt and want to pay it off, you may want to consider a balance transfer card instead. If you always pay your balance in full, then a card with a low annual fee or extra benefits such as reward points might make more sense.

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How much money can I save with a low rate credit card?

Even a small difference in credit card interest rates can save you a lot of money. Say you have a £2,000 balance on your credit card and you take six months to pay it off, with an interest rate of 20% p.a. you’d pay close to £120 extra on your debt.

But if you had a low rate card that charged 5% p.a., you’d pay around £30 in interest over the same time period. That’s a saving of over £80. And the bigger your expenditure, the bigger the difference gets.

How to compare low interest rate credit cards

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With a wide range of low rate credit cards on offer in the UK, comparing your options will help you find one that suits your needs. Here are the key factors you should consider:

Interest rates

When it comes to interest rates, the following factors can all impact on your potential savings and costs:

  • Promotional interest rates. Some credit cards give you an introductory low or 0% interest rate for purchases or balance transfers. This can be useful if you have planned purchases or existing debt that you want to pay off. But keep in mind that when the introductory period ends, a higher standard rate will apply.
  • Standard interest rate. The standard rate is the variable interest rate that applies at the end of any introductory 0% period. Depending on the card you choose, this rate could be much higher and not considered a “low rate” option. So always check the standard rate to make sure the card you’re applying for provides an ongoing low interest rate.
  • Cash advances. The interest rate for cash advances is usually higher than the rate applied to purchases. This rate is charged for transactions such as ATM cash withdrawals, foreign currency purchases and gambling. Cash advances also aren’t eligible for interest-free days.
  • Interest-free days. If there’s an interest-free period for purchases (and you’re eligible for it), interest won’t be calculated for those purchases until after that period ends. However, interest will apply in full if you don’t pay off the total owed by the due date on your statement. Learn more about how this works in our guide to interest-free days.

What is APR?

Credit card interest rates are usually advertised based on the Annual Percentage Rate (APR) that applies to the account. The APR is essentially the yearly cost to borrow. It is an industry standard term which all lenders must calculate in the same way.

APR can be a useful benchmark for consumers comparing credit cards, as it also takes into consideration any mandatory fees on the account.

However, the Financial Conduct Authority (FCA) states that this rate must be what 51 percent (or more) of people accepted for a card receive. This means that up to 49% of those accepted for a credit card will end up paying a higher rate. That’s why it’s often called “Typical” or “Representative” APR. It’s also important to remember that high fees can be offset by significant perks. A very premium card with a high annual fee is likely to have a high APR (as the APR takes into account the interest rate and the fees), but will also have some tasty benefits for the user.

Fees and charges

  • Annual fee. Try to find a card with a low annual fee, but don’t make this your sole deciding factor. A £0 annual fee isn’t helpful if the base interest rate on purchases is a lot higher. Annual fees typically range from £0 for cards with basic features to £150 or more for “gold” and “platinum” cards.
  • Other fees and charges. Fees may apply when you use your card at an ATM, overseas, online with international retailers or even when you apply for a balance transfer. Make sure you’re aware of the relevant charges that apply to your card.

Additional features

While most low rate credit cards have limited features, more premium cards could offer extra perks. Some of the most popular include:

  • Complimentary extras. Gold or platinum low rate credit cards may include perks such as travel insurance, purchase protection insurance or concierge services. If you use these extras, they have the potential to offset the cost of any annual fee you pay.
  • Rewards. Most low rate credit cards don’t offer rewards points for your spending as they are somewhat conflicting propositions. Cards that allow you to accumulate air miles or reward points typically charge more interest than cards which are promoted on their low rates.
  • No international transaction fee. If you plan to use your credit card when you travel overseas or shop online with international retailers, a low rate card that waives foreign transaction fees could help you save even more money.

Pros and cons of low rate credit cards

Pros

  • You’ll pay less interest on purchases, making it easier to manage your credit card debt.
  • Many low rate cards also have low, if not zero, annual fees.
  • Many low rate cards do not have introductory offer rates – meaning that their rates will stay low indefinitely.
  • You can often combine low rate cards with other features such as balance transfers or zero foreign transaction fees.

Cons

  • You’re less likely to receive reward points and other perks.
  • You may not qualify if you have a poor credit history.
  • If you opt for a card with a 0% period on purchases or balance transfers, it’ll only be available for a promotional period. After this a significantly higher rate will apply.

If you often carry a balance, a low interest credit card could help you save on additional fees and charges. Just remember to consider the other features – such as introductory offers, annual fees, and complimentary extras – to help you find a card that best suits your needs.

How to get a low interest rate credit card

After you’ve compared your options, applying for a low interest rate credit card is easy. You’ll be asked to provide details about yourself, your employment, your financial situation and must prove your identity. In order to prove your identity you will usually need your driver’s licence or passport. Applications take about 15 minutes and most provide a response within 60 seconds.

Answers to frequently asked questions about low interest rate credit cards

The NatWest Balance Transfer Credit Card (existing customers)
The NatWest Balance Transfer Credit Card (existing customers)

Balance transfers:

0% for 23 months reverting to 19.9%

Representative example: When you spend £1,200 at a purchase rate of 19.9% (variable) p.a., your representative rate is 19.9% APR (variable).

M&S Bank Shopping Plus Mastercard
M&S Bank Shopping Plus Mastercard

Balance transfers:

0% for 20 months reverting to 19.9%

Representative example: When you spend £1,200 at a purchase rate of 19.9% (variable) p.a., your representative rate is 19.9% APR (variable).

ASDA Money Cashback Credit Card Mastercard
ASDA Money Cashback Credit Card

Balance transfers:

0% for 12 months reverting to 19.9%

Representative example: When you spend £1,200 at a purchase rate of 19.9% (variable) p.a., your representative rate is 19.9% APR (variable).

The Royal Bank Balance Transfer Credit Card (existing customers)
The Royal Bank Balance Transfer Credit Card (existing customers)

Balance transfers:

0% for 23 months reverting to 19.9%

Representative example: When you spend £1,200 at a purchase rate of 19.9% (variable) p.a., your representative rate is 19.9% APR (variable).

*Disclaimer: The offers compared on this page are chosen from a range of products finder has access to track details from and is not representative of all the products available in the market. Unless indicated otherwise, products are displayed in no particular order or ranking. The use of terms "Best", "Top", "Cheap" including variations, are not product ratings and are subject to our terms of use. You should consider seeking independent financial advice and consider your personal financial circumstances when comparing products.

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2 Responses

  1. Default Gravatar
    PaulApril 4, 2019

    If I transfer the balance which exists on a high rate credit card to another card, will I be able to keep my existing card (i.e. with a zero or low balance)?

    • Avatarfinder Customer Care
      johnbasanesApril 5, 2019Staff

      Hi Paul,

      Thank you for reaching out to Finder.

      Yes you have the option to keep the existing card once the balance transfer has been made. Hope this helps!

      Cheers,
      Reggie

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