Warning for millions of UK credit card holders to make simple switch that could save £1,417

MILLIONS of credit card users incur interest on their balances each month, diminishing their disposable income and making it harder to get out of debt. 

These costly repayments are eroding people’s disposable income and trapping them in debt.

It comes after The Sun previously revealed that credit card interest rates have risen by up to 11% in the last decade.

Just 10 years ago, in April 2024, the typical credit card representative APR sat at 17.9%.

Fast-forward to April 2024, and the average rate is 24.8%, representing a 6.9 percentage point increase.

However, some lenders have hiked rates substantially more in the period.

For example, John Lewis has increased the representative APR on its credit cards from 16.9% to 27.9%, representing a huge 11 percentage point increase.

But experts at TotallyMoney have explained how millions of Brits can cut the interest they pay with a simple switch.

Credit card customers can put an end to paying interest for up to 29 months for a small processing fee of between 2-4% by shifting their debt to a balance transfer card.

With the market-leading offer, customers can stop paying interest for 29 months, saving £1,417 on the typical interest-bearing credit card balance of £2,901, according to Totally Money.

Those with less-perfect credit scores might be eligible for a 16-month card, saving £736, while those with poor credit scores might still be able to save £370 over nine months.

Alastair Douglas, chief executive of TotallyMoney, said: “If you’re paying interest on your credit card each month, then you should consider a balance transfer.

“It’ll stop you from paying interest, so you can focus on repaying your debt.

“You could save hundreds if not thousands of pounds.”

What is a balance transfer credit card?

Balance transfer credit cards could be a useful option if you have debt spread across a few different cards or soaring interest rates.

They allow you to move the balance from other cards onto a new one, and you pay no interest for a set period.

This means your debt is easier to pay off because money saved on interest can be used to put toward owed finances.

It’s important to note that you can’t transfer a balance between cards from the same bank.

How to find the best deals

You should always use an eligibility calculator before applying, that’s because every credit card application leaves a mark on your credit file and can affect your credit score.

The best cards currently available include one from Tesco Bank which is offering a 29-month long 0% deal with a 3.49% fee.

Lloyds Bank is also offering up to 28 months at 0% with a fee of between 3.45%.

To assess all the available cards, visit price comparison websites like MoneySavingExpert’s Cheap Credit Club or Compare the Market.

Once you run your details through an eligibility calculator and you’ve been shown that you’re likely to be accepted, make a formal application.

To do this, you will need to provide your name, address and email address as well as details of your income so a provider can assess your eligibility.

You will also need to provide details of how much money you want to transfer to the new card, but you can often do this after you have been accepted.

If your application is approved, you will need to transfer the balances within a set period, usually around 60 or 90 days.

Your old balance will then be cleared and you can start making interest-free repayments on your new card.