Our Pick Of The Best 0% Purchase Credit Cards
Interest rates charged by credit card providers has been steadily creeping up in recent months. According to Moneyfacts latest data, the average APR across all cards (including those with annual fees) is now 35.6% (August 2024). That’s up from 31.4% just a year ago.
A 0% purchase credit card doesn’t charge interest for a set period of time. When used strategically, this means you can spread the cost of big-ticket items over time without having to pay a penny over the value of the goods or services you are buying.
These deals are particularly useful if you don’t have immediate access to cash, yet you know you could afford to pay for it over the interest-free period. Even if you do have the money in the bank, you might want to keep it back for a rainy day and borrow cost-free instead.
What are the best deals?
Our research (August 2024) found that the best 0% cards for purchase come with periods of up to 21 months. However, what’s best for you will be determined by your income, credit score and personal circumstances. Offers change frequently but are correct at the time of publication.
Best 0% Purchase Credit Cards
*Fairer Finance data (August 2024)
How did we rank the cards?
We’ve ranked the top 0% purchase cards by the following factors, and in order of importance:
- 0% interest period: how many months you can make purchases on the card without being charged interest
- interest rate: the representative APR you’ll be charged when the zero-interest period ends
- customer experience: the customer experience rating of the card issuer as measured by independent data provider, Fairer Finance
- other perks: such as earning points on spending
There is a good chance the APR (annual percentage rate) you see advertised will not be the one you are offered. APRs are ‘representative’ which means they must only apply to 51% of successful applicants.
The 0% purchase cards with the lengthiest terms are reserved for applicants with top credit scores. Providers’ eligibility checkers which form part of the application process calculate your chances of being accepted for a card and on what terms. This means your credit score is protected should you be rejected and reapply elsewhere.
0% purchase credit cards in a nutshell
A 0% purchase credit card charges zero interest on borrowing for new purchases for a stated number of months. This time period is normally referred to as an ‘introductory offer’ or ‘promotional period’.
During the promotional period, 100% of your credit card repayments will go towards repaying your debt, not towards paying interest.
So, using a 0% purchase credit card means you can effectively borrow money for free, so long as you repay the entire debt before the end of the 0% period – and don’t incur other fees.
What can you use a 0% purchase card for?
For this reason, these cards are ideal for spreading the cost of large purchases, such as a new car or holiday. Alternatively, you can use a 0% purchase card for numerous small purchases.
Either way, the golden rule is to repay your debt within the interest-free period. For example, if you borrow £2,000 on the card and can afford to repay £100 a month, you need a card offering 0% interest on purchases for at least 20 months.
How can I find the best deal?
Broadly speaking – and so long as you use the card efficiently – the best 0% purchase card is simply the one that offers the longest interest-free period.
However, there are other factors to consider too. For example, any annual fees for having the card as well as the APR (annual percentage rate) that applies after the interest-free period ends, should you have a balance remaining.
Be aware that the rate advertised is representative which means it only has to be offered to 51% of successful applicants. You could be in the 49% of customers given a higher rate.
Customer experience can also play a part. Having a credit card that’s easy to manage will help when it comes to clearing your purchase balance before interest kicks in.
Unlike 0% balance transfer and money transfer credit cards, there’s no particular timeframe in which you need to make purchases to qualify for 0%. The only stipulation on 0% purchase cards is that purchases will need to be made within the 0% introductory offer period.
What about fees?
There are not usually any upfront fees associated with a 0% purchase credit card, although some premium credit cards might charge monthly or annual fees, while some kinds of transactions (such as taking cash out of an ATM or using your card overseas) are also likely to cost.
And, just like any other credit card, you still need to make at least the minimum payment each month. If you don’t you’ll be charged a late payment fee which is normally about £12. You may also lose your 0% promotional offer, and your credit score is likely to be damaged.
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