Focus on: Halifax chops fee to boost allure of All in One card

Here, we take a closer look.

09:10 09 April 2013

If you're in the market for a credit card that offers 0% interest on balance transfers but you don't want to pay a fortune to shift your debt over to it, Halifax's Online All in One credit card could be the plastic for you.

 

That's because Halifax has slashed the balance transfer fee on the Online All In One card from 3% to an effective 1%.

 

The card offers 15 months interest free on balance transfers and although this isn't the longest 0% deal on the market, the added bonus is that the Halifax card also offers 15 months at 0% on purchases.

 

What's the deal?

 

Halifax is offering a 66.6% refund on the transfer fee on its All in One Credit Card, reducing the fee to 1% from the previous 3%. This means that someone transferring a balance of £5,000 will now pay £50 compared to the previous £150.

 

Those applying for the offer must do so before June 25 and transfer debts of at least £100 by July 25.

 

Not only does the card offer 15 months at 0% on balance transfers, but it also offers the same 15-month interest free period on purchases, making it the market-leading all-round credit card.

 

It has a representative APR of 17.9% (variable).

 

Who's it good for?

 

This is a fantastic offer for borrowers who have debt sitting on an expensive credit card and who know they could pay off that debt within 15 months by transferring it to a 0% deal, but don't want to fork out hefty transfer fees.
It is also a great option for anyone keen to switch to a card that also allows them to spend on it without being caught out by interest charges.
 
Any catches?

 

The main catch is that while the Halifax All in One credit card is market-leading in terms of its offering on both balance transfers AND purchases, there are lengthier interest free deals available if you are only using your card for balance transfers OR purchases.

 

Barclaycard, for example, recently reacted to moves by rivals Tesco and Halifax - both offering 25 months interest free on balance transfers - by hiking the 0% period on its Platinum Credit Card with Extended Balance Transfer to a whopping 26 months. However, Barclaycard's offering comes with a large fee of 3.5%.

 

Meanwhile, if you're after a card for spending purposes, the Tesco Clubcard credit card for purchases offers 16 months at 0%.

 

Another catch with the Halifax All in One card is that, as with most credit cards charging 0% on balance transfers for an introductory period, you need to clear your debts in full by the time the interest free period ends. Otherwise, you will incur the representative APR of 17.9% (variable) on your outstanding balance.

 

The length of the 0% period you are offered, and the APR you pay, will also depend on your credit score. While most successful applicants will get 15 months interest free, some will be offered just 13 months at 0% with an APR of 21.9% and others will get 11 months and an APR of 25.9%.

 

What's more, only transfers from non-Halifax or Bank of Scotland cards will be accepted, whatever the terms of your deal.

 

It is also worth remembering that you must respect the transfer conditions to benefit from the lower fee - so ensure you apply before June 25 and transfer a balance of at least £100 before July 25.

 

What's the verdict?

 

While the balance transfer offer with Halifax Online All In One card is far from the longest on the market at the moment, its main attraction is the low fee. And if you can clear your debt within the 15-month 0% period, this low fee could save you a tidy sum of money.

If you transferred a debt of £5,000 to the Barclaycard Platinum Credit Card with Extended Balance Transfer, for example, the 3.5% fee would mean you'd pay £175, compared to the £50 you'd pay with Halifax.

 

The Tesco Clubcard Credit  Card for Balance Transfers, offering 25 months interest free on balance transfers, has a 2.9% fee (£145 on a £5,000 debt) and the Halifax Balance Transfer Credit Card currently has a fee of 2.5%, down from the previous 3% (£125 on a £5,000 debt).

 

However, there are other low fee options on the market. The Lloyds TSB Platinum Mastercard, for example, charges a fee of 1.5% and offers 21 months interest free on balance transfers.

 

But the purchase period on the Lloyds card is only three months at 0%. So if you're looking for a card suitable for both balance transfers and purchases, the Halifax card remains the best bet.

 

Top tip!

 

Being rejected by a credit card company can damage your credit file, so it is always worth bearing this in mind before firing off an application.

 

To avoid this, take a look at our SmartSearch facility which allows you to compare credit cards and get an indication of your chances of acceptance for each one without leaving a footprint on your credit file.

 

You can also get hold of your credit report from one of the credit reference agencies which you can compare at our credit reporting channel.