For Immediate Release
- £6 billion switched in month of January alone in the last 4 years (Jan 2015 to Jan 2018 inc)
- Total of 2.64 million balance transfer transactions in January in the last four years
- Two years ago, the longest 0% balance transfer (BT) deals were 43 months now only two lenders offer more than 30 months
- Customers urged to apply with caution and check their credit score first
Alastair Douglas, CEO of TotallyMoney, the credit experts, comments on the dwindling choice of long-term balance transfers as we approach the biggest month of the year for credit card debt switching.
“January has always been the bumper month for balance transfers, with many consumers re-jigging their finances as part of their New Year resolutions – but the best 0% terms are disappearing fast.”
“Last January was the busiest in 12 years with £1.63 billion switched in 31 days – it will be interesting to see if the trend continues next month.
“At the start of 2017 there were 10 major credit card providers offering 0% interest terms of 40 months or more, now the market has slumped and there are just two lenders with deals over 30 months (MBNA and Post Office).
“It seems that providers are falling out of love with ultra-long zero per cent cards and if the trend continues over the next 12 months, some consumers will become increasingly anxious if there’s no longer a healthy stream of 0% offers to help them plug the hole in their finances.
“TotallyMoney urges customers not to rush in and make panic applications and risk damaging their credit score. By signing up for a Free Credit Report users will be able to check their Borrowing Power and eligibility to find out which cards they have the most choice of being accepted for.”
| Credit card balance transfer activity for the month of January | ||
| Month | Value of balance transfers £ billion | Number of balance transfers |
| January 2015 | £1.34bn | 592,000 |
| January 2016 | £1.43bn | 631,000 |
| January 2017 | £1.60bn | 711,000 |
| January 2018 | £1.63bn | 705,000 |
| Total | £6.00bn | 2,639,000 |
| Source: UK Finance | ||
Alastair added: “Interest-free credit deals won’t be around for ever, so we encourage people to make the most of them while they are still around – if you can clear your debt within the promotional term it’s a smart and cost-effective way of managing your money.”
| Card Provider | Longest 0% BT deal at 1st Feb 2017 | Longest 0% BT deal at 17th Dec 2018 |
| MBNA | 43 months | 33 months – down 23% |
| Halifax | 43 months | 28 months – down 35% |
| Nuba (MBNA) | 42 months | Brand scrapped for new customers |
| Barclaycard | 42 months | 29 months – down 31% |
| Sainsbury’s Bank | 42 months | 30 months – down 28% |
| Lloyds Bank | 42 months | 28 months – down 33% |
| Virgin Money | 41 months | 29 months – down 29% |
| Santander | 41 months | 30 months – down 27% |
| AA Cards | 41 months | Cards not available for new customers |
| Tesco Bank | 40 months | 28 months – down 30% |
| Research Moneycomms.co.uk 17.12.2018 | ||
Andrew Hagger, Personal Finance Expert from Moneycomms said: “Some card customers use interest-free balance transfers as a smart way to save money, but for others it’s a way to keep their heads above water as they try to juggle increasing levels of personal debt and to stop their bank account going into the red”.
If you’re serious about shifting debt and getting your finances back on track, getting a copy of your Free Credit Report is essential as it’s the foundation to all your borrowing, whether it’s your plastic or a mortgage application.”