HSBC Purchase Plus Credit Card

BOTTOM LINE

The HSBC Purchase Plus Credit Card offers a number of different features which could make it appealing to a wide range of consumers. It has a 0% interest period for balance transfers made in the first 60 days, as well as a 0% interest period on new purchases during the 18 months following account opening. It could be ideal for consumers who are seeking to reduce the interest they pay on existing debt and also enjoy greater financial flexibility on new purchases.

Although it is possible to obtain a longer 0% interest balance transfer period or a longer 0% interest period on new purchases elsewhere, the card combines the two features to broaden its appeal. No annual fee plus the potential to earn rewards are two other selling points. However, a second card for use internationally may be required due to its non-sterling transaction fee of 2.99%

Credit Rating Requirement: Good/Excellent

What I like about the HSBC Purchase Plus Credit Card

• Balance transfer offer – The card offers 18 months of 0% interest on balance transfers made during the first 60 days from account opening. Consumers with balances held on other credit cards could therefore reduce their interest costs by transferring the debt to the HSBC Purchase Plus Credit Card. This may improve their cash flow, or allow them to pay off their existing balance quicker than they otherwise would have done.
• Lower interest – The balance transfer offer could significantly reduce the interest paid on existing debt. For example, an individual who has a £3,000 balance held on a credit card paying an interest rate of 18.9% and making monthly payments of £200 would take 18 months to repay the total amount. Transferring the £3,000 balance to the HSBC Purchase Plus Credit Card would avoid £408 in interest costs. Including the balance transfer fee of 2.9%, the total amount saved would be £318.
• 0% interest on purchases – The card also offers a 0% interest rate on purchases made within the first 18 months of account opening. Although it may not be a good idea to increase debt – especially for individuals who have existing balances held elsewhere – the 0% interest period on purchases could provide additional financial flexibility.
• No annual fee – The card has no annual fee. This simplifies its overall cost versus other cards and helps to improve an individual’s cash flow.
• Cashback and acceptance – Since the card uses Visa, it is accepted in over 200 countries worldwide. It offers a cashback and rewards scheme called Visa Offers. HSBC also operates a ‘home&away’ rewards service where customers can obtain discounts from popular brands and retailers.

What could be improved

• Balance transfer fee – A 2.9% charge is applicable on all balance transfers undertaken during the first 60 days of account opening. This reduces the appeal of transferring a balance to the card. However, it is likely that a 2.9% upfront charge plus a 0% interest rate for 18 months will work out cheaper for consumers who have existing debt held on other cards.
• Balance transfer opportunity – The 0% balance transfer period is only applicable to amounts transferred within 60 days of account opening. This provides a relatively limited timescale for customers to transfer debt held on other credit cards. Following the 60-day period, the card’s standard interest rate is applicable to balance transfers.
• International charge – As with many credit cards, a non-sterling transaction fee is applicable. It amounts to 2.99% of the amount spent on the card. As such, many consumers may find that they benefit from having a second credit card which does not charge a non-sterling transaction fee in order to keep their spending costs down when travelling abroad.

How does the HSBC Purchase Plus Credit Card’s offer stack up?

The opportunity to obtain a 0% interest rate on balance transfers as well as a 0% on purchases over an 18-month period means that the card could appeal to a wide range of consumers. It could reduce the amount of interest paid on existing debt, while also providing financial flexibility on new purchases.

It is possible to obtain a longer 0% interest period on balance transfers and purchases elsewhere. However, in many cases it is a case of it being ‘either/or’ in terms of obtaining a longer 0% interest period on balance transfers or on new purchases. Therefore, the HSBC Purchase Plus Credit Card offers a rounded set of features which could make it an attractive main credit card for everyday use. Its rewards offering and lack of annual fee enhance its appeal, although a second credit card may be worth having for travelling abroad due to its non-sterling transaction fee.

The HSBC Purchase Plus Credit Card score

The card is available to all UK residents over the age of 18 who do not have an HSBC Basic Bank Account. An annual salary or pension of £8,500 is required. Applying online is relatively straightforward, with a pre-filled form for existing HSBC customers reducing the amount of time it takes to apply.

The interest rate quoted for the card is, as with all cards, representative. It is offered to the majority of successful applicants, with the remainder receiving a different rate. This could make the card less appealing compared to peers depending on an individual’s personal circumstances.

How to apply

Applications can be made online, by phone or in branch. Temporary workers, individuals who are on zero-hours contracts and the self-employed are advised to apply by phone or in branch. Information such as identification, proof of address and a recent bank statement will be required in order to apply. Individuals seeking to transfer balances from existing credit cards will also need details about their current debt.

Is the HSBC Purchase Plus Credit Card right for you?

The card’s diverse range of features means it could be a worthwhile ‘one-stop’ option for consumers. It offers a 0% interest period on balance transfers for 18 months as well as 0% interest on purchases for the same amount of time. Although it is possible to find cards with longer 0% interest periods in the two areas, finding them on the same card could prove to be challenging.

Therefore, for consumers who are seeking to reduce the interest being paid on an existing balance as well as 0% interest on new purchases, the card could be attractive. No annual fee and the opportunity to earn rewards improve its relative appeal. A second credit card for use abroad may be required, though, as a result of the card’s non-sterling transaction fee.

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