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What is a balance transfer and how does it work?

With a balance transfer credit card, you can move your credit card, store card debt and even personal loans (for some brands) to a new credit card that charges 0% interest on the balance transferred, giving you time to potentially pay down and clear your debt. Some credit providers also allow you to transfer BNPL debt.

How do I compare and choose a balance transfer card?

Here are the main factors to look at: The length of the interest-free period, whether any balance transfer fees apply, the annual fee, the balance transfer limit, and the revert rate.

What fees should I expect to pay on a balance transfer?

One of the most important fees to look out for is the balance transfer fee. Not all balance transfer cards charge balance transfer fees, so if it’s not obvious, check the fine print to make sure. A balance transfer fee may be charged as a flat rate, but it’s more commonly charged as a percentage of the amount you're transferring.

How many debts can I transfer to my new card?

You may find some providers allow for the transfer of a number of balances, while other providers only allow one transfer.

Do I have to cancel my old card?

You can choose whether you keep the old card or cancel it. Remember you may have to pay an annual fee. If you think you might be tempted to spend on the old card, you may be better off closing the account to focus on paying the balance transfer debt.

Can I make new purchases on my balance transfer card?

Yes, you can, but you’ll likely pay interest on those purchases right away. You can spend up to your credit limit, but having a balance transfer means you won’t get any interest-free days on your purchases.

Is it a good idea to do a balance transfer?

If you’re struggling to pay down existing debt, a balance transfer can help you save money on your interest repayments.

Do balance transfers hurt credit score?

Applying for a balance transfer credit card won’t affect your score any more than a regular application. It’ll show up as a standard hard enquiry on your credit file and may lower your score as is normal for loan and credit card applications.