A balance transfer card moves existing credit card debt onto a new card with a low or 0% introductory interest rate for a set period. Used deliberately, it can turn a balance that was quietly growing into one you can actually clear. Used carelessly, it just relocates the problem and adds a fee.
How it works
You apply for a card offering a promotional rate on transferred balances, move your existing debt across, and — if you've got the strategy right — pay it down during the promotional window without interest piling on top. Most balance transfers carry a one-off fee, typically a percentage of the amount moved, so factor that into whether it's worth it.
The numbers that matter
- The promotional rate and how long it lasts. A longer 0% window gives you more time, but compare it against the fee.
- The transfer fee. A percentage of the balance, paid upfront. A "0% for longer" card often charges a higher fee, so the cheapest option depends on how fast you'll repay.
- The rate after the promotion ends. This jumps, often sharply. The plan should be to clear the balance before then.
Who it suits
Balance transfers work best for people with a defined balance they're committed to clearing, the discipline not to rack up new spending, and a credit profile good enough to be accepted for a decent offer. Our guide to how credit scores work covers the last point; running the comparison through a regulated comparison service, ideally with an eligibility checker that uses a soft search, avoids unnecessary hard searches.
It's a tool, not a fix
A balance transfer buys time and saves interest, but it doesn't reduce what you owe by itself. The saving only materialises if you use the breathing room to actually pay the balance down. If the underlying issue is spending exceeding income, that needs addressing too — see our budgeting guide.