If you have some outstanding balance on your credit card and are looking for ways to reduce the interest amount payable, we have some valuable information for you. The answer to this dilemma is balance transfer. This facility allows you to transfer the outstanding balance on your credit card to another card at 0% interest or a very low interest rate.
This is an opportunity to pay back your debt with ease. How, you may ask? Well the 0% interest lasts for a fixed period of time, usually three to six months, during this time you can pay back the outstanding balance without any additional interest. Once this period ends, you are expected to payback the outstanding balance at a regular interest rate which generally hovers around 2.89%. Ideally you ought to maximise the months available at 0% interest and pay back as much as you possibly can. This is great way for you to minimise your debt and pay back as little interest as possible.
Visit us here to find an exhaustive list of banks offering balance transfer facilities. You can also use our Compare Credit Card feature to find the perfect card that meets your needs.
Everything you need to know about Balance Transfer credit cards
- How do you apply for a Balance Transfer?
The first step is to get a Credit Card in the bank where you wish to transfer your existing balance. You can request for a balance transfer at the time of application or as soon as you receive your credit card.
- How long is the duration for balance transfer?
The duration varies from one bank to another, depending upon its policy. It varies from (typically) 3 to 6 months, after which the remaining transferred balance is subject to the purchase rate
- Is there a Balance transfer fee?
Routinely, banks apply a 1-2% balance transfer fee on the amount being transferred and usually cut this down to 0% during their promotional schemes.
- Do you need to pay during the balance transfer period?
It is mandatory to pay a minimum of 5% outstanding on a monthly basis. Customers are encouraged to pay off as much as possible during the 0% interest period to benefit from balance transfer.
- How much can you transfer?
The amount you can transfer depends upon a number of factors. You have to consider the credit card limit, free credit on your card and bank policies. Banks can usually allow balance transfer to the tune of 90% to 95% of the Credit Card.
Here is a list of a few cards that you can consider. You can alternately view an entire list of options here
|Bank Name||Processing Fee||Credit limit that can be used for balance transfer||Interest free period||Rate of interest post the promotion period|
|HSBC||AED 100 per transaction||80%||6 months||2.25%|
|ADIB||2% of transferred amount||90%||3 months||2.99%|
|UAB||AED 250 per transaction||95%||6 months||2.99%|