Banks have been hiking interest rates on credit cards despite repeated cuts to the base rate.
The Bank of England has slashed the base rate from 5% in September to 1.5% today, but credit card APRs have actually risen from 17.45% to 18% during the same period.
As a result, the average credit card customer is now paying interest at a whopping 12 times base.
We take a look at two cards that can help keep your plastic debt in check.
The Halifax All In One Credit Card
Choosing a credit card that comes with 0% offers on both new purchases and balance transfers is a great way to manage your debt from one place.
While there are a number of such deals on the market, it’s essential you choose one where both offers last for the same amount of time, otherwise the inverse order of payments could end up costing you a fortune (read more about this here).
The Halifax All In One Credit Card is probably the best of these, offering 0% for nine months on both purchases and transfers (with a 3% fee).
Use this card and you won’t need to worry about interest on past or future debt until late 2009.
The Virgin credit card
For those who are only looking to clear existing debt, the Virgin credit card is definitely the best balance transfer offer on the market at present.
The card charges no interest on transfers for an impressive 16 months (with a 2.98% fee), and comes with a lower than average 16.6% APR.
This should give you ample time to pay off your arrears. If not, be sure to make a note of when your introductory period expires so you can switch to another 0% balance transfer offer before then.
