Has MBNA launched the best credit card available?New card offers lowest rate, but is it right for you?

06 June 2014

Credit card

MBNA's new Low Rate MasterCard offers the most competitive rate on the market for ongoing card purchases and balance transfers.

The card offers a simple 6.5% p.a (variable) on card purchases, balance transfers and money transfers, additionally charging no fee to transfer a balance to the card.  

What's more, it also allows you transfer money to your current account from the card with no handling fee.

It's a fantastic option for those who want a low rate on everyday spending, especially if they are constantly facing overdraft charges on their current account. 

However, customers looking to make a large card purchase are still likely to be better off with a good 0% purchases deal, which is interest-free for a set period of time.

Which? comparison table: Best 0% purchase credit cards - our tables are updated in real time 

How does it compare? 

Everyday spending:

At 6.5% p.a (variable), MBNA's new credit card offers the lowest purchase rate on the market, beating off the best low rate cards offered by rivals Natwest/RBS, Sainsbury's and Tesco Bank. Customers who do not qualify for the headline rate may be offered 8.9% or 11.9%. 

Which? Comparison Table - Best credit cards for everyday spending - compare the best deals on the market

Balance transfers:

With no handling fee to transfer a balance and a 6.5% ongoing interest rate this card offers the best 'life of a balance' deal on the market. 

If you have a large debt, a card with a long 0% balance transfer deal and low transfer fee may still work out as a more cost-effective solution, as long as you pay the balance off over the 0% period.   

This card also allows you transfer money to your current account from the card with no handling fee. This is a reasonably unique selling point, as many cards charge a typical handling fee of up to 5% and interest rates of up to 20.9%. 

Which? Comparison Table: 0% balance transfer credit cards - our tables are updated in real-time 

In-store rewards:

It's worth bearing in mind that there is no retail reward scheme associated with this card. 

Meanwhile, Sainsbury's Bank and Tesco Bank currently offer credit cards with the next lowest purchase APRs on the market (6.9% and 7.8% respectively). These cards also offer reasonably good in-store reward rates on card purchases, so could be a better choice if you are a frequent shopper at either supermarket. 

Which? Comparison Table: Best credit cards for retail rewards - compare the best deals on the market

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