An interest-free credit card has been launched onto the market by Barclaycard, following a similar move by Halifax.
The Barclaycard offering allows 24 months of interest-free credit for balance transfers, while Halifax offers the same deal but for 20 months. The former allows for £20 cashback for customers who transfer a balance of more than £3,000 directly through the Barclaycard website, although it does carry a fee of 2.8 per cent of the sum being moved on to the card.
Michelle Slade, from personal finance website Moneyfacts.co.uk, remarked: “At zero per cent for 24 months, the new deal from Barclaycard is the longest balance transfer deal ever offered on the market.
“In the last year, the number of longer term balance transfer deals has soared as competition has returned to the credit card market.”
However, critics have suggested that the deals will encourage a ‘pay later’ attitude, which led many people into debt problems during the recession. Indeed, while the card offers zero per cent on balance transfers, any new purchases will attract interest at around 18.7 per cent.
MBNA and Virgin Money also offer credit cards with zero per cent deals, although these only last for 19 months.
