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The best 0% money transfer credit cards

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Last updated on

16 January 2015

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Are you paying painfully high interest on your overdraft? A top money transfer credit card could cut your interest rate to zero.

Overdrafts on current accounts can be painfully expensive.

One way to get out of the red is to use a 0% money transfer credit card.

These work by letting you transfer money from your credit card to your current account. Once you’ve transferred the money, you can use it to pay off your overdraft.

Credit card companies usually charge very high rates of interest on this sort of cash advance, higher than you would pay with most overdrafts.

However, 0% money transfer credit cards allow you to transfer money from your card at 0% interest for an introductory period.

This is very similar to a 0% balance transfer. There are only two differences:

1. You’re transferring money from a card to a bank account, instead of transferring a debt from a card to another card.

2. The fee is often higher for a money transfer than for a balance transfer. Money transfer fees are usually around 4% whereas balance transfer fees are typically between 1.5 and 3%.

The longest 0% deal

The longest lasting 0% deal on the market right now comes from the Fluid 29-Month Balance Transfer Credit Card.

It offers 29 months 0% on money transfers as well as 29 months 0% on balance transfers. Once approved for the card you’ll have 60 days to do a money transfer.

So if you have a £2,000 overdraft, you could transfer that sum from the Fluid card to your current account to freeze the size of the debt for 29 months.

The biggest downside is that you’ll have to pay a 4% fee when you make a money transfer. On a £2,000 debt that amounts to £80. The fee has to be paid upfront all in one go.

You’ll also have to make the minimum repayment on the card each month. If you’re late with a payment, the 0% deal can be terminated and you'll also get a black mark on your credit report.

The other crucial point is that if you haven’t paid off the resulting debt within the 0% period, you’ll then start paying interest at 18.9%.

The rivals

There are other cards to consider here though.

The AA Balance Transfer Visa boasts a 28-month 0% money transfer period with a 4% fee.

While the Fluid 26-Month Balance Transfer Credit Card offers a 26-month interest free money transfer period also with a 4% handling fee.

And the various charity and football credit cards provided by MBNA (everything from WWF to Manchester United) offer a 24-month 0% money transfer period, which also attract a 4% fee.

Finally there's the MBNA Platinum Credit Card, which offers a 24-month 0% period on money transfers with a much smaller 1.94% fee.

Personal loans

If a money transfer isn’t for you, another option is to take out a personal loan. See The cheapest personal loans for the best rates right now.

The rates on offer are significantly less than an overdraft at 19%, but again you’ll only be accepted at this rate if your credit score is good. 

If your credit rating isn’t perfect, you may be offered a loan at a higher rate but if it’s below the amount attached to an overdraft then it is still worth going for.

Compare the market-leading credit cards

This article is regularly updated to reflect the best deals

More on credit cards:

The best reward credit cards

The best cashback credit cards

The best 0% purchase credit cards

The best credit cards to use abroad

The best 0% balance transfer credit cards

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