0% purchase credit cards

Compare 0% credit cards | Features | Best 0% purchase credit cards | FAQ’s | Conclusion

Fancy a splurge? New sofa, new kitchen, new car? Whatever you’re in the market for, 0% purchase credit cards give you more cash to splash by not charging any interest on big purchases. And you to pay off the balance over a longer period of time.

Of course, all good things must come to an end – typically interest-free periods last between 3 and 15 months so try to find a card that lets you pay off your debt over the longest period of time.

But don’t forget, once the zero interest intro period is over the rate will revert back so any purchases you haven’t managed to pay back yet will start accruing interest.

There are two types of interest free offers that you might have come across. A 0% purchase rate credit card is where the zero interest lasts for a specified limited amount of time from when you’re first approved for the card.

Other cards have interest free days each statement cycle (usually around 55 days), giving you longer to pay back each statement without being charged any extra.

Compare 0% purchase rate credit cards

[Note for Martin: this is where we add a table with pre-set 0% purchase rate cards loaded onto the results]

What is a 0% purchase credit card?

Is a 0% purchase credit card for me?

No two cards are the same and there are many factors to consider when comparing 0% purchase credit cards, we’ve outlined a few things to consider…

How long is the zero purchase period?

Before you sign on the dotted line, make sure you’re picking a card that gives you the best deal and that’s going to allow you to use the interest free period to your favour. 

Usually ranging from 3-15 months, you should think about how much you’re going to spend and whether or not you’ll be able to pay it off before the standard purchase rate is applied.

Should I pick a card with the longest zero interest promo offer?

Ask yourself why you’re after this type of card? Would you just like a couple of extra months to pay off your purchase, or are you wanting a longer solution? Would you prefer a card with a shorter zero interest period, but more extras? 

When comparing cards try to calculate the best deal by working out the dollar value of any benefits you would use, including the 0% purchase option –  the one that comes out on top could be the winner!

Do you already have a credit balance to consider?

Be realistic with how much you’re able to pay off. Time flys when you’re having fun (as they say) and these interest free periods can come back to bite you on the bum quicker than you’d expected.

If your repayment plan doesn’t see you getting to a zero balance by the end of the interest free period, you might want to consider a low interest card instead. Alternately, moving your debt to a 0% balance transfer card could be an option to help you repay your debt interest-free.Do the math and work out which sees you better off in the long run.

Does the card have an annual fee?

If you’re getting the card for a particularly exxy purchase, consider the cost of the card as an addition to the item you’re buying. You might be better off getting a card with no annual fee and low interest rate if you don’t think you’ll be able to pay off the balance in time before the interest rate shoots back up.

What is the revert rate after the initial free period?

Purchase rates vary between 11% p.a. and 22% p.a on typical credit cards. This factor only matters if you don’t think you’ll be able to pay off the balance before these rates kick-in after your interest free period. 

Take time to set yourself some realistic repayment goals to figure out what’s what.

Are you charged for spending overseas?

It’s worthwhile checking if the introductory 0% p.a. rate will apply to overseas purchases, especially if you’re intending on travelling a fair whack and using your card. If you’re a frequent traveller, comparing the cards which are best for overseas spending could be more cost-effective.

What extras are on offer?

Rewards points, free travel insurance, purchase protection, you name it. Lots of credit cards come with additional features created to lure you in. An easy question to ask yourself is do the extras outway the cost of the card? There’s little point paying a high annual fee for all the extras you’re unlikely to use.

What does the small print say?

When comparing these cards, pay attention to the length of the promotional period, what interest rate applies at the end of the introductory offer and any other card features and fees so that you can find one that suits your needs. Before taking out any financial product it’s important to read the terms and conditions in fully to understand what you’re in for and don;t get stung with any nasty surprises.

How to get the best card for you

Credit cards are designed to suit all different goals, so there isn’t necessarily one card that is best for all, however there are a few things to bear in mind to make sure you don’t end up with the wrong plastic. Here’s a few don’ts…

Don’t forget the intro period ends

The best things in life are free, but they don’t last forever. Whilst the 0% purchase period is great – it will revert to the standard variable purchase rate after a time, so make sure you know when this is so you don’t get caught-short paying interest on a balance you haven’t managed to pay off.

Don’t forget to pay

A common mishap! Just because there’s no interest, doesn’t mean no repayments. You are still required to pay the minimum amount on each statement, otherwise you will be charged a late payment fee which doesn’t look great on your credit history. Plus, remember the aim of the game is to pay off the balance asap, so if you can pay off more than the minimum.

Don’t use it to take out cash

Generally speaking, credit cards work better when used for paying with plastic, rather than used for taking out cash. You’ll be charged a cash advance fee if you take out money at an ATM, even with the 0% interest offer. Need access to cash? Compare cards with low cash advance fees.

Don’t use the card for ineligible transactions that you pay interest on

Not all purchases are eligible for zero interest, so check the small print so you don’t trip up. Typically, cash advances, government payments or other cash-equivalent transactions accrue an interest.

What is the best 0% credit card?

In such a competitive market it can be a minefield trying to figure out which card is best. It’s a good idea to compare a range of features such as length of interest period, annual fee, revert rate and extras on offer to find the card that gives you the best bang for your buck. 

Everybodies financial circumstances are different- so what might be right for your partner or friend may not necessarily be right for you. Also do your due diligence when comparing credit cards and work out your repayment to make these cards work in your favour.

FAQ’s

How do 0% purchase credit cards work?

0% purchase credit cards are great when you use them to your advantage. If you’re splurging but don’t have the funds right now, you can pay off your debt over a longer period of time accruing no interest, ending up no worse off.

What does 0% pa on purchases mean?

It literally means no interest charged per annum. You will often see p.a in the world of credit cards referring to purchase rates or balance transfer rates for example. It is the percentage interest you will be charged per year. 

When it comes to zero interest credit cards, the 0% rate will only last for a specified amount of time and then a standard rate of interest will apply.

Are all purchases interest free?

No, take note of the small print as not all purchases are eligible for zero interest. You won’t be charged interest on eligible purchases during the intro period, as long as you pay the minimum amount listed on each statement.

Which is the longest interest-free period?

Generally the most amount of time you’ll get interest free is about 15 months. Many cards offer the same amount of interest free time so it’s hard to see which one is offering the best deal. There usually extras included like reward points or complimentary travel insurance to make their offer more attractive.

Do I have to make repayments with 0% interest cards?

Yes, all credit cards require you to, at the very least, repay the minimum each month. Whilst you may not be accumulating interest, you still need to make a payment each statement.

What is a revert rate?

It’s the standard interest that kicks in after the interest free period is over.

What’s the difference between 0% interest credit cards and interest-free days?

0% on purchases credit cards charge no interest on new purchases for a certain period of time, as long as you pay your bill on time each month.

Whereas interest free days are offered on all types of cards gives you a window of time each month to buy items and not be charged for a few days – usually around 55 days, giving you more time to pay back the debt interest free.

Conclusion

0% purchase credit cards really can be used to your advantage as long as you guarantee you’re organised with your repayments. Allowing you to buy the things you need now and paying back later without paying any extras.

General Advice Warning:

The information provided is of a general nature only and does not take into account any personal objectives, financial situation or needs. Before making a decision you should consider the appropriateness of the information having regard to your personal circumstances. 

Always read the full terms and conditions.