Best 0% Finance Credit Cards in the UK

Credit cards are an essential part of life in the UK. According to data, 35 percent of payment cards issued in the United Kingdom in 2020 were credit cards. In this article, we will look at the best 0% finance credit cards you can use in the UK.

How a Credit Card Works

A credit card is a financial product issued by banks that lets you spend money on credit. The best way to think about a credit card is to think of it as a loan that a bank lends to you. You can then use the funds on your day-to-day operations. You can buy a television set, pay your hotel, rent a car, and buy stuff online. A credit card differs from a debit card in that the latter takes money from your checking account. A credit card, on the other hand, uses the issuers money and then bills you later. Another difference between the two is that a credit card usually reports your activity to a credit bureau while a debit card does not.

Types of Credit Cards

Banks and other issuers have innovated and created different types of credit cards. These cards are aimed at different types of people. For example, a travel card is aimed at business executives who are always on the move. The other types of credit cards are:

  • Standard cards – These are also known as plain vanilla cards because they don’t offer anything else other than credit.
  • Rewards credit cards – These cards reward their users whenever they purchase.
  • Student credit cards – As the name suggests, these cards are designed for students. They have features that favour this demographic.
  • Charge cards – A charge card is one that does not have a preset spending limit. The balance must always be paid at the end of every month.
  • Secured credit cards – These are credit cards that have collateral behind them. They are mostly used by people with a poor credit history.

Other common types of credit cards are subprime credit cards, limited purpose cards, business credit cards, and balance transfer credit cards.

What are 0% Finance Credit Cards?

Banks that issue credit cards profit from the interest you pay. A 0% finance credit card is one that waives the interest you pay for a certain number of months. For this reason, you will not be charged any interest before the period expires. For example, if you buy a television set with the card, you will not be required to pay any interest rates. You will then start paying regular interest when the period of 0% interest ends.

Top 5 0% Finance Credit Cards in the UK

Many banks in the UK offer 0 finance credit cards. Here are some of the best cards you can apply:

Barclaycard Platinum

This credit card offers a 0% interest rate on purchases for up to 27 months. It also offers 0% interest for 27 months on balance transfers. After the period elapses, the card charges you a variable 21.9% APR. It does not have an annual fee.

 

Sainsbury’s Bank Dual Offer Credit Card

This credit card offers a 0% interest rate on purchases and balance transfers for 27 months. It has a balance transfer fee of 3%. It has no annual fee. Below is a representative example of interest rates you will pay after the 27 months.

 

M&S Credit Card Shopping Plus

This credit card by Marks & Spencer offers 0% interest rates on purchases for 20 months. It also offers a 0% on balance transfer for 20 months. Unlike the Sainsbury’s card, the transfer fee is 2.9% with a minimum of 5 pounds.

 

HSBC Purchase Plus Credit Card

This credit card from HSBC offers 0% interest rate for 18 months from account opening. It also offers a 0% rate on on balance transfers made within the first 60 days. A transfer fee of 2.9% is applied. The card does not have an annual fee.

 

Santander Zero Credit Card

Santander Zero Credit card gives you 0% interest rate for the first 12 months after account opening. It offers no foreign transaction fees when you are paying in local currency and no cash withdrawal fee globally. To apply, you must have an annual income of more than 7,500 pounds per year.

 

What is a Balance Transfer?

As you have seen above, we have talked about a balance transfer and you might be wondering what it is. A balance transfer is a facility that allows you to move part or all of the balance of another credit card to your 0% interest card. People use this transfer because it helps them save money by moving to a card that does not pay fees. Some banks have placed a limitation on the banks that they allow this transfer.

Eligibility for a 0% Finance Credit Card

Banks have a criteria on the people who can apply and qualify for their 0% finance credit card. Some of the general qualifications for this are:

  • Age – One must be over the age of 18 to apply and qualify.
  • UK residence – You must be a residence in the UK for the past three years.
  • Bank account – You should provide your bank account details to the bank.
  • Employment – To qualify, most banks require that you must be employed. You should also not be student.
  • Court cases – You should not have filed for bankruptcy, have individual voluntary agreements (IVA), and court judgements.
  • Credit history – The bank will check your credit history and score to confirm that you can pay the debt.

How to Apply for a 0% Finance Credit Card

The process of applying for a credit card with 0 finance is relatively easy. Most banks in the UK allow you to apply for the card through the phone, email, or by visiting the bank physically. You can also use the bank’s online platform to apply for the card. Before you do, we recommend that you use websites like Money Supermarket to compare the services offered by most banks.

Pros of 0% Finance Credit Cards

0% finance credit cards have a number of pros. Some of the most common pros are:

  • No interest rate – The cards allow you to borrow money for free without paying interest rates.
  • Spread costs – A 0% finance credit card is excellent if you are planning to acquire something major.
  • Pay off debt – As seen above, all cards give you a free balance transfer. You can use this feature to pay off debt faster.

Cons of 0% Finance Credit Cards

While all 0% finance credit cards are good, they also come with a few cons. Some of these cons are:

  • High interest rates – These cards have a higher rate after your set free months end.
  • Penalty for missed payments – The bank could cancel the free period if you miss or delay a payment.
  • Consumption – The card can make you increase your consumption because you don’t pay any interest rate.

Summary

0 finance on a credit card gives you the ability to borrow money for free for a set period of time. While the card is good, we recommend that you remember to pay the funds on time. This will help you lower your interest rates by helping you improve your credit score.

Crispus is a finance professional with more than a decade experience in the industry. Over the years, Crispus has written in-depth articles on leading platforms like CCN, Marketwatch, and Seeking Alpha. He also runs a Forex education and managed account company called WestEndFx.