How do 0% credit cards work?
Exploring 0% introductory or promotional rates and how you can use them.
A quick summary
A 0% credit card is a credit card with a 0% introductory/promotional interest rate available for a set duration. This means you can spread costs by paying off less than the full amount each month and still pay no interest. Once the offer ends, the standard rates will apply to the remaining balance of your card.
- Your 0% offer is usually on specific transactions like card purchases or balance transfers.
- If you pay late or miss a payment, you may have to pay fees, lose any promotional offers you have, and it could damage your credit score.
- Introductory or promotional offers are subject to status and availability.
0% credit cards can let you borrow without paying interest
With a 0% interest rate offer, you use your credit card without paying interest on your balance for a set period of time. This usually relies on you using your card for its intended purpose (e.g. card purchases or balance transfers) and paying off your balance before your offer ends.
0% offers are for a set period of time
Your 0% interest rate is usually an introductory/promotional offer given to you for a limited time. Afterwards, any remaining introductory/promotional rate balance, will be charged at the card’s standard rate.
What is an introductory or promotional rate?
You must still make your minimum payment on time
Even if you’re paying no interest, you still need to make at least the minimum payment towards your balance every month. Otherwise, you could end up losing your introductory/promotional rate.
Key things to know about any 0% credit card
To make the most of your 0% offer check your card’s terms and conditions and your statements. These include details about your introductory or promotional rate and its expiry date, helping you to keep track.
Always plan how you'll use a 0% credit card
If you plan ahead, you can apply for a card that offers an introductory or promotional rate on the particular use you require.
Let’s look at the details
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Not necessarily. Depending on your circumstances you may not be eligible for the offer. Or you might get the offer for the full period advertised or for a shorter length of time.
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You can find a breakdown of the interest rates which apply to your balance on your PDF or paper monthly statement. You’ll be able to see any different rates of interest based on transaction type or whether it’s a standard or promotional interest rate. And you can check when introductory or promotional interest rates will expire.
Key points on 0% credit cards
- A 0% credit card has an introductory or promotional 0% interest rate for a limited period.
- Usually the 0% interest rate applies only to certain transaction types, such as card purchases or balance transfers.
- When your introductory or promotional offer comes to an end, your remaining balance will be charged at the card’s standard rates.
- To avoid paying higher interest rates, plan ahead and try to pay off your balance in full before the 0% offer ends.
- If you don’t keep to the terms and conditions of your card, for example by not making your minimum payment on time, then you risk losing your introductory or promotional offer.
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