A money transfer credit card lets you move money from your credit card into your bank account. You can then use these funds to make a purchase or to pay off an existing debt. Note that you will usually be charged a transfer fee of up to 5% when you transfer the funds.
If you have a money transfer card that offers 0% interest, you won’t pay any interest on your credit card repayments for a number of months. The best deals currently last over a year.
After the promotional period ends, interest is charged on any remaining balance at the credit card’s standard rate. Approval for any credit card depends on your status. The representative APRs shown represent the interest rate offered to most successful applicants. Depending on your personal circumstances, the APR you’re offered may be higher, or you may not be offered credit at all. Fees and rates are subject to change without notice. It’s always wise to check the terms of any deal before you borrow.
Approval for any credit card depends on your status. The representative APRs shown represent the interest rate offered to most successful applicants. Depending on your personal circumstances, the APR you're offered may be higher, or you may not be offered credit at all. Fees and rates are subject to change without notice. It's always wise to check the terms of any deal before you borrow.
Money transfer credit cards let you move money from your card directly to your bank account. The maximum amount you can transfer will usually be a percentage of your credit limit – typically 90% to 95%. The minimum is usually around £100.
Once you’ve compared lenders and found the best money transfer deal for you, submit your application and wait to receive your card. Once you’re up and running, log in to your account, choose “money transfer” or “transfer money to my bank account” and select the amount you want to transfer. You’ll then need to provide your bank account details so your transfer can be paid. If the card provider approves the transfer, the money can be in your account within 1 to 3 working days. After the transfer is complete, you make monthly repayments to your credit card provider.
If your card has a 0% introductory offer, you benefit from interest-free payments for a number of months as long as you make your minimum monthly repayments on time. If you don’t make your minimum repayments, you could lose your promotional rate and have to pay interest much sooner.
If you still have a balance outstanding at the end of the promotional period, it starts to accrue interest from this point. Always aim to pay off the balance within the low or 0% interest period.
One good way to do this is to set a monthly direct debit payment for the amount borrowed, divided by the number of months of the deal. This ensures you make the necessary monthly payments to clear the debt before interest starts accruing.
Although you’ll pay little or no interest on the amount(s) transferred, you will likely be charged an initial fee when you ask for a money transfer. This is usually between 1% and 5% of your transfer amount. So if you were transferring £2,000 and your card charged 5%, you’d pay £100. This is usually added to your balance.
In many cases, it can still make sense to pay a high fee if it means a longer interest-free period. But if you can pay off your balance quicker, you might want to look for a card with a lower transfer fee and a shorter 0% period.
Confused by the difference between these 2 terms? A balance transfer involves bringing across an outstanding credit card debt from your old card to a new card. A money transfer (in this context) simply involves making an online transfer of funds from your credit card to a bank account of your choosing.
When you compare money transfer credit cards, be sure to consider the following:
To get a money transfer credit card, you need to be at least 18 years old and a UK resident. You’ll also need a bank account to receive the funds. To qualify for the most competitive deals – those cards that offer the lengthiest 0% deals – you’ll need to have a good credit rating. If you don’t, you might be offered a shorter interest-free deal or turned away completely.
It’s sensible to use an eligibility checker before you apply for a credit card, as this will tell you which cards you’re most likely to get accepted for so you can apply with confidence. What’s more, because it uses a soft search, it won’t affect your credit rating.
Some of the alternatives to a money transfer credit card include:
An overdraft can be a useful option for short-term borrowing, but it can also be expensive. A handful of providers offer interest-free overdrafts on their current accounts, but these tend to be for a limited time or a limited amount only. Otherwise, interest rates sit between 15% and 40%.
You can typically borrow a much larger sum with a personal loan than you can with a credit card. The most competitive interest rates tend to be on loan amounts of between £7,500 and £15,000, and you’ll need to repay this in fixed monthly instalments, making it easier to budget. You can typically borrow over a period of 1 to 7 years.
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