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MBNA challenges Barclaycard with improved balance transfer card

MBNA challenges Barclaycard with improved balance transfer card
Date of Publication: Friday, 22 August 2014 13:29

MBNA has improved the terms on its balance transfer credit card to become a genuine threat to the market leaders.

 

The provider has increased the 0% balance transfer and money transfer period on its Platinum Visa card to an impressive 32 months, placing it just one month behind Barclaycard’s longest term.

 

It has also reduced the balance transfer fee to 2.69%, making it one of the cheapest cards available for such a long 0% term.

 

MBNA joins Halifax, Bank of Scotland, Lloyds Bank and Tesco Bank poised precariously behind Barclaycard’s market-leading card, but it muscles ahead of the chasing pack with its lower transfer fee and flexible money transfer options.

 

Customers wishing to switch their balance to one of these market-leading cards face a charge of around 3% for transferring their balance. It works out at around £30 for every £1,000 they transfer to the new card.

 

This, of course, is pittance compared to the 18% or 19% interest they might otherwise pay on their balance without an introductory offer. But even so, with added competition in the market, credit card providers are beginning to target lower transfer fees in addition to long spells at 0%.

 

The MBNA offer means that customers with a strong credit record can apply for a term just one month shy of the maximum available on the market and save 0.3 percentage points on the transfer cost from Barclaycard’s leading offer.

 

Another useful feature of the MBNA card is the money transfer option, which allows cardholders to pay into their current account and charge it on their credit card account within 60 days of opening their account.

 

It commands a higher 4% handling fee, but customers get the full 0% term to pay this off as part of their credit card balance.

 

The card’s standard purchase rate is 18.9% APR, based on a credit limit of £1,200. But those who can avoid purchases (perhaps using the money transfer option as a workaround) could reap the rewards from this highly competitive card.

 

Keith McDonald

Which4U Editor

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Friday, 22 August 2014 13:29
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Top 5 Credit Cards

Card
Balance Transfers
Purchases
Typical APR (variable)
Apply
View Full Table >
N/A
N/A
18.9%
Representative Example: If you spend £1,200 at a purchase interest rate of 18.9% (variable) your Representative APR will be 18.9% (variable).
0%
12 mths
0%
12 mths
15.9%
Representative Example: If you spend £1,200 at a purchase interest rate of 15.9% (variable) your Representative APR will be 15.9% (variable).

Advice

No foreign transaction fees on purchases and cash withdrawals abroad when made in the local currency. No cash withdrawal fees at home and abroad (interest is charged immediately on cash withdrawals and some independent ATM providers may charge a withdrawal fee).

Introductory Offer
Balance Transfer Rate: N/A
Balance Transfer Fee: N/A
Purchase Rate: N/A
Representative APR
Purchases: 18.9% p.a. (variable)
Representative Example: If you spend £1,200 at a purchase interest rate of 18.9% (variable) your Representative APR will be 18.9% (variable).
Annual Rates
Balance Transfers: 18.9% p.a. (variable)
Cash Advance: 18.9% p.a. (variable)
Annual Fee: N/A
Standard Features
Interest Free Days: Up to 56 days
On-Line Banking: Yes
Approval Criteria
  • You are at least 18 years of age;
  • You have had a permanent UK address for at least the last 3 years;
  • You do not have a history of bad credit (in other words, county court judgements or bankruptcy);
  • You have an income in excess of £7,500.

Advice

Collect 0.5% unlimited cashback on all purchases in pounds sterling. Also, get commission free card purchases abroad!! No balance transfer fee applies for the first 3 months of account opening, after which time it will revert to 2.4% (Minimum £5)

Introductory Offer
Balance Transfer Rate: 0% for 12 mths
Balance Transfer Fee: N/A
Purchase Rate: 0% for 12 mths
Representative APR
Purchases: 15.9% p.a. (variable)
Representative Example: If you spend £1,200 at a purchase interest rate of 15.9% (variable) your Representative APR will be 15.9% (variable).
Annual Rates
Balance Transfers: 15.9% p.a. (variable)
Cash Advance: 27.9% p.a. (variable)
Annual Fee: N/A
Standard Features
Credit Limit: £25,000
Interest Free Days: Up to 56 days
On-Line Banking: Yes
Cashback
Standard Cashback Rate: 0.50%
Approval Criteria
  • YOU MUST HAVE A NATIONWIDE CURRENT ACCOUNT IN ORDER TO APPLY FOR THIS CARD
  • You are at least 18 Years of Age
  • You have an Excellent Credit History
  • You are a permanent resident/citizen of the UK
  • You earn over £5,000 per year