Pros and Cons of the Bt Credit Card

As credit card rewards go the program offered by the BT credit card is a paltry one, giving a reduction of one penny on BT phone bills for every £1.50 spent on the card. This is hardly the most alluring rewards program on offer and those seeking a better return on their spending would be advised to look elsewhere. The card does however offer one major benefit.

The BT credit card offers interest free money transfers directly to ones current account, for a marginal fee of just 4%. Thus anyone seeking a low cost loan for the thirteen month introductory period offered before the interest is applied, may wish to consider the card.

Providing the full amount of the money transfer is repaid to the card issuer MBNA within the thirteen month period then the offer amounts to a loan at just 4% APR, which is excellent. This is ideal for anyone wishing to make a large ticket item purchase and spread the cost interest free, for the 4% fee.

The card is advertised with a headline rate of 16.9% APR, which is rather misleading, as there are several different tiers of interest rates applied to different transactions.

Balance transfers are offered at 0% APR for thirteen months, but must be taken within the first ninety days of opening the account. Balance transfers carry a 3% fee. The interest rate after the promotional period is between 18.9%-26.9%, depending on ones credit standing.

The interest rate applied to money transfers to current accounts varies again and is charged at the higher rates of between 20.9%-27.9%, thus making it imperative that anyone seeking a low rate credit card loan ensures it is paid back within the required period before interest is charged.

Purchases are charged at 0% APR for three months only, from the date the account is opened. Thereafter the interest will be charged at 16.9%-24.9%. The interest rate applied to cash advances is 27.9%, and there is also a minimum £3 cash advance handling fee charged at 3%. The default fee is standard at £12.

The BT credit card is an online card which operates with paperless statements. As a credit card it has nothing special to recommend it, but the option of taking a thirteen month money transfer which effectively works as a 4% loan makes it an attractive proposition for anyone needing a loan.

The 4% rate undercuts standard loan products whilst money transfers offer far more flexibility than balance transfer. However anyone without the discipline to ensure the loan could be repaid before the interest is charged should avoid the temptation to apply for the card.