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.