New credit card balance transfer offers from Barclaycard and Capital One

Commenting on two new credit card balance transfer offers, Stuart Glendinning, managing director of moneysupermarket.com, said: “Barclaycard's launch of a credit card offering 0 per cent on balance transfers until July 1, 2008 follows closely behind a similar offering from Capital One. When people consider there is also the Virgin deal offering 0 per cent on balance transfers for 13 months, we are looking at the most competitive range of deals available since the introduction of balance transfer fees nearly three years ago.

“There has been the odd, isolated card offering longer term 0 per cent balance transfer deals – Capital One offered 0 per cent for 18 months last year – but the combination of so many providers offering such long terms is new and indicates that card providers are competing vigorously for business.

“The balance transfer fee was first introduced by Barclaycard in August 2004 and has since become the industry norm. The primary purpose, other than improving profit margins, was to eradicate the ‘rate tart’. So far this has proved an effective way to stop people churning their debt from one 0 per cent balance transfer deal to another by making people have to pay for the privilege. However, the current batch of new cards shows that offering 0 per cent on balance transfers is still a key way to attract new customers. Providers are pulling out all the stops to hit their sales targets.

“Indeed, people can still save large amounts by transferring their balances to the right card – as much as £300 a year in interest payments could be up for grabs, even taking the balance transfer fee into account.”