Nationwide launches cheapest-ever balance transfer fee
The card, which offers 26 months at 0% on balance transfers, comes with fee of just 0.75%.
That's at a time when the average balance transfer fee on the top 10 balance transfer cards is currently 2.84%.
So compared to that average fee, someone transferring a balance of £3,000 would save £62.70 with the Nationwide deal.
The lowest-ever balance transfer fee follows in the wake of Barclaycard launching the longest-ever balance transfer 0% deal at 31 months.
However, the Barclaycard Platinum comes with a balance transfer fee of 2.99% - and the lender initially charges you 3.5% before 'refunding' you the difference two days later.
Cat amongst the pigeons
Commenting on the balance transfer war currently being waged by the card companies trying to outdo each other, Andrew Hagger of Moneycomms.co.uk said: "This latest deal from Nationwide will really throw the cat amongst the pigeons in the credit card market.
"The combination of a long interest-free term and ultra-low balance transfer fee is likely to see the credit card big boys - Barclaycard, MBNA, Halifax and Tesco Bank - scrambling to review and revamp their own card deals.
"For so long now it's been a case of longer and longer interest-free deals with fees of around 2.8% to 2.99% but Nationwide has ripped up the rulebook with this outstanding credit card offer - a bold move and a very positive one for consumers."
Kevin Mountford, head of banking at MoneySuperMarket, added: "Nationwide's move is the first time a credit card provider has significantly reduced the balance transfer fees and means some of the rules about picking the best balance transfer card no longer apply as in many instances a card with a shorter promotional period but a very low fee will be cheaper."
Used by the holder to buy goods and services, credit cards also have a monthly or annual spending limit, which may be raised or lowered depending on the creditworthiness of the cardholder. But unlike charge cards, borrowers aren’t forced to pay the balance off in full every month and, as long as they make a stated minimum payment, can carry a balance from one month to the next, generating compound interest. As the issuing company is effectively giving you a short-term loan, most credit cards have variable and relatively high interest rates. Allowing the interest to compound for too long may result in dire financial straits.
This is a mutual organisation owned by its members and not by shareholders. These societies offer a range of financial services but have historically concentrated on taking deposits from savers and lending the money to borrowers as mortgages, hence the name. In the mid-1990s many societies “demutualised” and became banks. One academic study (Heffernan, 2003) found demutualised societies’ pricing on deposits and mortgages was more favourable to shareholders than to customers, with the remaining mutual building societies offering consistently better rates. In 1900, there were 2,286 building societies in the UK; in 2011, there are just 51.
Moving money from one account to another, whether switching bank accounts or more likely transferring the outstanding balance on your credit card to another card that charges a lower – or 0% – rate of interest. Some card providers may charge a transfer fee that can be a percentage of the balance transferred.