A balance transfer credit card lets you move an outstanding balance from one or more existing credit cards onto a new card, often with a promotional low or 0% interest rate for a limited introductory period, giving you a window to pay down the debt without accumulating further interest at the original higher rate. Once the promotional period ends, the standard interest rate typically applies to any remaining balance, and most banks charge a one-time balance transfer processing fee calculated as a percentage of the amount transferred, so the total saving depends on how much of the balance is cleared within the promotional window.
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Frequently Asked Questions
Is there always a fee for transferring a balance to a new card?
Most banks charge a one-time processing fee based on the transferred amount, so it's worth factoring this into the total cost calculation rather than assuming the transfer is entirely free.
What happens if I don't pay off the balance before the promotional period ends?
Any remaining balance typically reverts to the card's standard interest rate once the promotional window closes, which can be significantly higher than the introductory rate.
Can I transfer balances from more than one card onto a single new card?
Many banks allow consolidating multiple existing balances into one balance transfer, subject to the new card's available credit limit.
Does a balance transfer affect my credit score?
Applying for a new card is generally recorded on your AECB file like any credit application, and your utilization on the new card will reflect the transferred balance.
How can I compare balance transfer offers across banks?
Use the credit card finder to compare promotional rates, transfer fees, and introductory periods across available balance transfer cards.