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Best low-interest credit cards

Find out if a low rate credit card that offers a consistently low interest rate for borrowing could be for you, or if you'd be better off with a 0% deal in Which?'s expert guide.

In this article
What is a low-interest credit card? Who should use a low-interest credit card? Best low-interest credit card deals Who are the best low-interest credit card providers?
Which low-interest credit card is right for me? Should I get a low-rate credit card? Low-interest credit cards – pros and cons Low-interest credit cards FAQs

What is a low-interest credit card?

A low-interest credit card is a deal which comes with a relatively low rate on purchases and/or balance transfers for as long as you have the card.

Credit cards typically charge 23% APR, but the very best low-interest deals charge as little as 5.9% APR, offering a cheap way to borrow or shift debt whenever you need it and no need to switch cards because an introductory deal has expired. 

You can find the latest low-interest credit card deals on Which? Money Compare. This guide explains what you need to know about low-interest credit cards, and helps you find the best deals currently available. 

 

Who should use a low-interest credit card?

With a low-interest card, you get a low rate for life. This means you get a consistent cheap deal and there’s less pressure to pay off your balance within a set period.

It can be easier to budget, and you won't have to switch around regularly to avoid interest rate hikes like you do with 0% promotional offers, which have a time limit that can catch you out.

Credit card deals with 0% on balance transfers and 0% on purchases are cheaper than a low-interest credit card.

But if you're not likely to pay off the total you spend before the end of the promotional period, which can last between one to 29 months, you can get stung with an average rate of 23% APR.

So, if you'd prefer to have a low standard rate on borrowing for more certainty about the rate you will pay a low-interest credit card could be for you.

Best low-interest credit card deals

The Which? Money Compare credit card tables let you search hundreds of credit cards to help you choose a great deal for you based on the quality of service, as well as cost and benefits.

Below we’ve picked out some of the top low-interest deals for purchases and balance transfers. 

Please note that the information in this article is for information purposes only and does not constitute advice. Please refer to the particular terms & conditions of a credit card provider before committing to any financial products.

Credit card Balance
transfer interest
p.a
Balance
transfer fee
Purchase
interest p.a.
Representative
APR
Tesco Bank
Low APR Credit Card
6.05% 3.99% 5.9% 5.9%
Lloyds Bank Platinum
Low Rate Credit Card
6.4% 3% 6.4% 6.4%
Halifax
Flexicard Credit Card
6.45% 3% 6.45% 6.4%
Bank of Scotland
Low Rate Credit Card
6.45% 3% 6.45% 6.4%
Barclaycard
Platinum Simplicity
Low Rate Credit Card
6.9% 3% 6.9% 6.95%
The NatWest
Credit Card
6.9% n/a 9.9% 9.9%
The Royal Bank of Scotland
Credit Card
6.9% n/a 9.9% 9.9%
American Express
Rewards Low Rate Card
9.9% 3% 9.9% 9.9%

Who are the best low-interest credit card providers?

When searching for a low-interest credit card deal it can be difficult to differentiate between offers, so you might find our credit card company reviews handy in your research.

Which? has reviewed 29 credit cards companies including top low-interest credit card providers, such as Halifax and Barclaycard. You can take a look at how they stack up in the best and worst credit card providers.

The companies that combine great deals with top-notch customer satisfaction are awarded our coveted Which? Recommended Provider status. 

Only one Which? Recommended Provider, Tesco Bank, offers a low-rate credit card. Its Clubcard Low APR credit card has a representative APR of 5.9%. 

Which low-interest credit card is right for me?

With a credit card there are four main types of transactions you can do. You can:

  • make a new purchase;
  • make a balance transfer from another card (usually for a one-off fee);
  • make a money transfer to a current account with a one-off fee); 
  • or make a cash withdrawal.

Some low-interest credit card providers have a uniform rate for all three types of transactions, but others vary the interest they charge.

Make sure you are getting a card that offers the cheapest deal for what you want to use it for.

Even if you're accepted for a credit card, you won't always end up with the advertised rate.

Legally, providers only have to offer their headline rates to 51% of those that apply so you could be part of the 49% that get a worse deal.

Lenders will assess your application based on your individual circumstances. Those with a better credit profile and score are more likely to be offered the best deal.

Should I get a low-rate credit card?

There are different types of low-rate credit card, so the best low-rate credit card for you will depend on your circumstances. 

For example, if you have existing credit card debt, you might want to consider a credit card with a long 0% balance transfer deal and a low transfer fee.

Also remember that those with better credit ratings are more likely to be offered a lower annual percentage rate (APR), so if you have poor credit, you may not get the super-cheap deal you've seen advertised.

On the best low-rate credit cards, you can expect to pay around 7% on outstanding balances, but some come with rates of as high as 18.9%.

Low-interest credit cards – pros and cons

Still weighing up whether you should go for a low-interest credit card? Check out the pros and cons to help you decide.

Pros

Peace of mind - there are usually no annual fees on low-rate credit cards and what's more, the rate is usually set for the life of the card. so you won’t have to worry about the cost of your debt ramping up later on.

Easier to budget -  because you usually get a rate for life it's easier to budget as there'll be no unexpected rate increases, and you won't have to switch your cards regularly.

No pressure - with a low-interest card there’s no pressure to pay off your balance within a set time.

Cons

Not the cheapest way to borrow - if you're looking to transfer a balance or make an expensive purchase, you could be better off with a 0% purchase or balance transfer deal, providing you can repay the debt within the promotional period.

Low-rate might not be for everything - the low-interest credit card you get might offer a good deal for purchases but might have a different rate for other types of transactions like balance transfers or cash withdrawals.

Low-interest credit cards FAQs

Have a query about low-rate credit cards? See if you can find the answer in our Q&A below:

 

How high is the limit on a low-interest credit card?

 

The credit limit you get on a low-interest credit card will depend on a lender’s assessment of your individual circumstances.

 

Do low-interest cards come with low-rate cash withdrawals?

 

Some providers will offer the same low-interest they have on offer for purchases as they do for balance transfers and cash withdrawals- but some don’t.

It’s important to check the rate applied to the type of transaction you want to do.

 

Should I consolidate debts onto a low-interest credit card?

 

Low-interest credit cards do allow you to transfer balances from other credit and store cards, as well as transfer money to your bank account, which could be used to pay off debts. You will pay a fee to transfer a balance or withdraw cash. 

A low-interest credit could be a solution to consolidate debts, but you'll need to weigh up other options, such as a personal loan or a 0% balance transfer deal.

If you have less than £5,000 of debt, using a credit card may be a better option. The cheapest loan rates tend to be on offer for loans of £5,000 and upwards. 

The advantage of either a loan or a 0% balance transfer deal is that you have fixed period to repay your debt - you take a loan out for a fixed term, while a 0% balance transfer deal lasts for a set period, before a higher interest rate is charged on your debt.

If you're looking to pay off your debts, it may be more helpful to have a period of time set to keep you focused on clearing what you've borrowed. 

A low-interest rate credit card, however, rarely has an introductory deal - meaning it could be easier to leave debt hanging around for longer.

 

Can I get a low-interest credit card for bad credit?

 

As we've said earlier in the guide, the best low-interest credit card rates tend to be on offer for those who have the best credit health. 

If your credit history is patchy, you may still be accepted for one of these cards, but might not get the super-low rate advertised. 

People with bad credit, or no credit history, are unlikely to qualify for one of these cards, and if they do, may get a significantly higher rate (often above 20%) to reflect the fact that they are a higher risk customer because of their past. 

There are specialist credit cards for people with bad credit. Read our full bad credit cards guide, with links to the top cards available, to find out more. 

 

What if I have another question?

 

You can put your question to our experts on the Which? Money Helpline or email us using money-letters@which.co.uk.

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