Tesco 0% Balance Transfer Fee Credit Card

Great for: Balance transfers with no fee
4 stars question mark

Don't overlook the Tesco 0% Balance Transfer Fee Credit Card. The 20-month balance transfer period isn't on the super-long end, but it's still more than a year and a half. Better still, you won't pay a fee on your balance transfers. This is a better choice if you're just looking for balance transfers, as there's no 0% purchase period. However, you will collect Tesco Clubcard points when you shop with this card.

Read full review >

CREDIT RATING req:

  • Poor/No credit
  • Fair/Average
  • Good/Excellent

HIGHLIGHTS

  • 0% interest for 20 months on balance transfers
  • No fee on balance transfers
  • 1 Tesco Clubcard point for every £4 spent in Tesco and 1 point for every £8 spent elsewhere

REPRESENTATIVE EXAMPLE

Representative rate 19.9% APR (variable)
Interest on purchases 19.9% p.a. (variable)
Assumed credit limit £1,200

what we like

  • 0% interest for 20 months on balance transfers
  • No fee on balance transfers
  • 1 Tesco Clubcard point for every £4 spent in Tesco and 1 point for every £8 spent elsewhere
  • ANNUAL FEE:

    £0
  • REPRESENTATIVE APR:

    19.9%
  • INTRO OFFER:

    0% on balance transfers for 20 months

KEY SCORES:

  • 3/5 Perks
  • 5/5Fees
  • 3/5APR

Our Bottom Line

The Tesco 0% Balance Transfer Fee Credit Card offers consumers the chance to reduce their interest payments on existing debt over a 20-month period. Its 0% transfer fee and 0% interest period could save individuals significant sums on existing debt, while no annual fee and Clubcard points further increase the appeal of the card.

Some may prefer to pay a small transfer fee in order to obtain a longer 0% interest period. However, in addition to the 20 months of 0% interest on balance transfers, this card also offers 0% interest on money transfers during the first 12 months. Therefore, it is likely to appeal to a range of consumers.

Credit Rating Requirement: Good/Excellent

What I like about the Tesco 0% Balance Transfer Fee Credit Card

  • Balance transfer – The card offers a 20-month balance-transfer period. This means that no interest is charged on any amounts transferred in the first 90 days after account opening for the entirety of the balance transfer period. This could help consumers who have existing debts on other cards to pay less interest, which could reduce their total expenditure over the 20-month period.
  • Lower interest – An individual can transfer a balance of up to 95% of the credit limit on their Tesco 0% Balance Transfer Fee Credit Card from a different card. Assuming that the APR on the existing card is 18.9% and that they have a £2,500 outstanding balance with repayments of £135 per month, they would save £434 in interest if they took advantage of the balance transfer offer over the 20-month period.
  • No fees – The card does not charge customers a fee on balance transfers, as long as the transfer is undertaken in the first 90 days of account opening. There is also no annual fee.
  • Technology – Tesco offers a wide range of options for account management, including online, phone and mobile app. It also offers contactless payments (for amounts up to £30 in a single transaction) and Apple Pay.
  • Clubcard points – Tesco Clubcard points are collected on almost all transactions at a rate of 1 Clubcard point for every £4 spent in Tesco stores, and 1 point for every £8 spent elsewhere. Clubcard points can be used to obtain discounts on purchases at Tesco and a variety of other stores as part of the wider rewards programme.
  • Money transfer – Money transfers are charged 0% interest within the first 12 months from account opening, although there is a 3.94% money-transfer fee. This could provide consumers with a relatively low-cost loan if required.

What could be improved

  • Transfer fee – Although the transfer fee on balance transfers is 0% for the first 90 days, it rises to 3.99% after that date. This is high in comparison to other balance transfer cards and, while likely to be lower than the amount charged on existing credit card debt held on a different card, could make the idea of a balance transfer less appealing.
  • Balance-transfer period – A 20-month balance transfer period may provide some respite and savings for an individual with credit card debt held elsewhere. However, it is not among the longest balance transfer periods available in the marketplace, and may prove to be too short for some consumers.
  • International usage – The 2.75% sterling transaction fee charged on purchases made abroad means that consumers may require a second card for holidays or business trips, which reduces the flexibility and convenience of the card.

How does the Tesco 0% Balance Transfer Fee Credit Card stack up?

The 0% balance transfer fee is relatively attractive, with a number of competitors charging consumers for transferring existing debts from other cards. However, it is possible to obtain a longer 0% balance transfer period elsewhere for a modest transfer fee. This may be a better option for those people who feel they need longer than 20 months in order to pay down or repay their debt. This could save a larger amount of interest for an individual in such a scenario.

The Clubcard points are appealing, especially since a number of balance transfer cards don’t offer cashback or similar rewards. On the other hand, some competitors offer 0% interest on all purchases on the first year of being a cardholder in order to provide consumers with greater financial flexibility.

The Tesco 0% Balance Transfer Fee Credit Card score

The 20-month balance transfer period may not be available to all applicants. Depending on an individual’s circumstances, a shorter balance-transfer period may be offered. Likewise, the advertised APR is representative, which means that at least 51% of applicants will be offered that rate. Those with middling credit may be offered a higher rate.

The card is available to new and existing Tesco credit card customers, provided they do not have more than one other credit card with the company. An annual income of at least £5,000 and a good credit history are required.

How to apply

Applications can be made online, with the process taking less than 10 minutes. Basic details such as previous addresses over the last three years, salary and take-home pay, as well as other credit card information in order to undertake a balance transfer are also needed. The company’s contact centre is available 24 hours per day, 365 days per year if online is not an option for customers.

Is the Tesco 0% Balance Transfer Fee Credit Card right for you?

For an individual seeking to reduce the interest they pay on existing debt, the 20-month 0% interest period on balance transfers is appealing. The lack of a transfer fee helps to keep costs down even further versus competitors, and could save individuals significant sums in interest payments.

For some consumers, a longer 0% interest period on balance transfers may provide them with greater financial flexibility. Although a transfer fee may be payable for a longer 0% interest period, the benefit of having more time to pay off an existing balance without incurring interest charges may outweigh this. Clubcard points and the lack of an annual fee add to the card’s appeal versus competitors.


The Motley Fool receives compensation from some advertisers who provide products and services that may be covered by our editorial team. It’s one way we make money. But know that our editorial integrity and transparency matters most and our ratings aren’t influenced by compensation. The statements above are The Motley Fool’s alone and have not been provided or endorsed by bank advertisers. The Motley Fool has recommended shares in Lloyds, Tesco and Barclays.

Advertiser Disclosure