A purchase credit card can be an affordable way to spread the cost of things you buy. For example, it may be useful if you’re buying something expensive and can’t afford to pay for this in one go, such as a new phone or a holiday.
An interest-free purchase credit card is a credit card that doesn’t charge interest for an agreed period of time. When this period ends, you then have to pay interest on any outstanding balance you have on the card.
You can spend money on a 0% purchase card without having to pay interest for a certain period of time - this could be for as little as three months or 20 months or more. You’ll need to stick to the credit limit and make the minimum monthly payments on time and in full, or you may lose the promotional rate early.
As with any credit card, there are things you should watch out for. Here are some advantages and disadvantages of 0% purchase credit cards.
Remember, we’re a credit broker, not a lender†
When you take out a credit card, you’ll usually pay back interest – this is on top of paying back money spent on the card or any debt that’s been transferred to it. The amount of interest you pay is calculated as a percentage of what you owe – this percentage is called the interest rate.
For credit cards and loans, you’ll usually see an APR (Annual Percentage Rate). This is the total amount of interest and fees you pay each year. APR is commonly used to compare different credit cards.
With these cards, it’s important to clear the balance every month, in full and on time – otherwise, the interest can get quite expensive. Purchase credit cards usually offer a 0% promotional rate for things you buy instore or online – but they may charge a different rate for other kinds of transactions, such as cash withdrawals.
Remember, we’re a credit broker, not a lender†
0% refers to the interest rate you’d be charged on any purchase you make, during the specified time period. As long as you make the minimum monthly repayments on time and in full and stick to any other terms and conditions on the card, you shouldn’t have to pay interest on the qualifying balance.
Make sure you know when the introductory rate ends. If you can, budget carefully to clear the balance in full before the end of the promotional period, to avoid being moved on to what may be a high interest rate once it’s over.
Here are some things to consider when choosing a purchase credit card.
Remember, we’re a credit broker, not a lender†
If you have a poor credit score, you may struggle to get a 0% purchase credit card. Lenders usually keep their best offers for people with higher credit scores. But this doesn’t necessarily mean you won’t get a purchase credit card with bad credit.
If you’re having trouble getting a purchase credit card because you have bad credit, you might want to try improving your credit score first before applying for a card.
Remember, we’re a credit broker, not a lender†
Before you apply for a 0% purchase card, it can be helpful to get an idea of your chances of approval. Applying only for cards you’re eligible for can help you avoid refusal and reduce the number of applications you have to make. This is important, because each time you apply for a credit card a hard credit search is recorded on your credit report – this can be seen by lenders and may reduce your credit score. However, simply comparing credit cards before you apply leaves a soft search on your credit report – this won’t affect your credit score, as lenders aren’t able to see it.
To get the best purchase credit card offers, it can be helpful to improve your credit score. See our guide for tips on how to do this.
You can find out your free Experian Credit Score and check your chances of being approved by viewing your eligibility rating for relevant 0% purchase credit cards.
Compare credit cards with Experian, and get an idea of your chances of approval for each card when you compare – we’ll match your credit information with lenders’ criteria to calculate your eligibility rating for each deal. Remember, we’re a credit broker, not a lender - we can help you find deals, but we don’t provide credit or decide whether to approve your application.
Experian uses your credit information - as well as information you provide about your requirements and financial circumstances – and compares it to lenders’ criteria to show you how likely you are to be approved for a credit card.