A 0% purchase rate credit card gives you a way to spend without being charged interest during an introductory period. With this type of offer, you’ll typically get an interest-free period that lasts between 3 and 15 months from when you’re approved for the card.
What’s the catch with 0% purchase rate credit cards?
At the end of the introductory period, the 0% interest rate reverts to the credit card’s standard rate for purchases. When that happens, you'll be charged interest on any purchases you haven't paid off during the 0% p.a. period. Any new purchases you make will also attract interest charges at the standard rate for your card.
This means potential interest charges and debt are the biggest risks to watch out for with a 0% purchase rate offer. But you should also pay attention to credit card annual fees, which can add to your upfront costs.
The best 0% purchase credit cards*: finder.com.au
Compare the features of these competitive interest-free credit card offers:
BankSA Vertigo Platinum. Enjoy a 0% p.a. interest rate for 15 months on purchases and complimentary travel insurance.
*The products compared on this page are chosen from a range of offers available to us and are not representative of all the products available in the market. There is no perfect order or perfect ranking system for the products we list on our Site, so we provide you with the functionality to self-select, re-order and compare products. The initial display order is influenced by a range of factors including conversion rates, product costs and commercial arrangements, so please don't interpret the listing order as an endorsement or recommendation from us. We're happy to provide you with the tools you need to make better decisions, but we'd like you to make your own decisions and compare and assess products based on your own preferences, circumstances and needs.
How does a 0% p.a. purchase credit card work and when is it useful?
0% purchase credit cards can help you save on account costs when you need to make a large purchase, or when you know you’ll be spending a lot of money in a short amount of time. For example, if you’re travelling overseas, shopping for Christmas presents or planning a wedding. In these situations, a 0% p.a. credit card gives you a way to get what you need when you need it and pay it off over time with zero interest.
However, if you’re still carrying a balance from your purchases after the introductory period ends, the card’s standard interest rate will apply to the debt. Paying off a 0% purchase credit card before the end of this period means you will get the greatest value from the interest-free offer.
How much money can I save with a 0% interest credit card?
Say you want to book an overseas flight that costs $2,000 and plan to put $200 a month towards paying it off. If you paid for your flights on a credit card with a 17% p.a. interest rate, it would take you around 11 months to pay off the balance and cost you about $172 interest charges.
In comparison, if you had a credit card that offered 0% p.a. on purchases for 12 months, you could pay off your flights in 10 months without any interest charges.
How can I find the best 0% purchase rate credit card?
Credit cards with 0% purchase rate offers are designed to suit different goals, so there isn’t one “best” option. Instead, find the right card for you by considering and comparing these features:
The 0% purchase rate period. This introductory period typically ranges from 3 to 15 months, so make sure you think about how much you're going to spend and whether or not you’ll be able to pay it off before the standard purchase rate applies. If you can't pay it off before the end of the introductory 0% interest period, you might want to apply for a card with a longer introductory period or be prepared to pay some interest when the offer ends.
Annual fee. Ideally, the value you get from your credit card should outweigh this cost. As well as considering the potential savings you’ll get during the introductory 0% p.a. interest period, make sure you weigh up the value of other ongoing perks on the card – such as complimentary insurance or rewards. You could also look at credit cards that have no annual fee to see if any of them also offer an introductory 0% purchase rate period.
Standard purchase interest rate. This varies between cards but is typically between 13% p.a. and 22% p.a. If you don't think you can repay the entire balance before the 0% purchase rate period ends, think about whether the ongoing purchase rate will be affordable. You could also look for a card that offers a low ongoing purchase rate or consider transferring the debt to a card with a 0% balance transfer offer so you can continue paying off your debt without interest over a promotional period.
Foreign transaction fees. While the introductory 0% p.a. rate will apply to purchases you make overseas, you may still be charged a fee worth approximately 2-3% (or more) for transactions made overseas or online with an international business. You can compare credit cards which do not charge currency conversion fees in our detailed guide.
5 common mistakes to avoid with 0% purchase credit cards
If you want to get the most out of a credit card's 0% p.a. introductory period, watch out for these traps:
Ignoring the standard purchase rate. At the end of the promotional period, the 0% purchase rate will revert to the standard variable purchase rate, which usually sits between 13% p.a. and 22% p.a. This makes it important to check the standard purchase interest rate before applying for a credit card so that you're aware of the potential costs if you don't pay off your purchases during the introductory period.
Forgetting to make repayments. Even with an introductory 0% p.a. interest rate on your credit card, you still need to pay at least the minimum amount listed on each statement. This is usually 2% or 3% of the total balance or a minimum dollar amount, such as $20 to $30. If you don't pay the minimum that's listed by the due date on your statement, you could be charged a late payment fee.
Only paying the minimum amount. If you only pay the minimum repayment amount that's listed on each statement, you won't repay the entire balance before the 0% interest offer finishes. Any balance remaining after that will be charged interest at the card's standard rate, making it harder to pay off the debt. To avoid this situation, aim to pay off all your purchases before the introductory period ends. If you're unable to repay your balance before the 0% purchase offer ends, a balance transfer might be the next step.
Ineligible transactions. This type of 0% credit card interest rate offer only applies to eligible purchases. So if you use your card for balance transfers, cash advances, government payments or other cash-equivalent transactions, the card's standard interest rate will apply to these charges (unless a separate promotional offer applies).
Not planning your purchases within the offer period. The 0% purchase rate offer is available as soon as your credit card is approved, not from when you make your first purchase. So if you get a credit card with 0% p.a. on purchases for six months but you don't make a purchase or any repayments for the first month, you'll only have five more months of the interest-free period. If you have a big purchase in mind, make it as soon as possible and start making repayments immediately to get the maximum value while the offer lasts.
Credit cards that charge an introductory 0% p.a. rate on purchases can be a great way to save money on big-ticket items or upcoming expenses, but only for a limited time. When comparing these cards, pay attention to the length of the promotional period, what interest rate applies at the end of the introductory offer and any other card features and fees so that you can find one that suits your needs.
Frequently asked questions
If you want to know more about 0% purchase credit cards, here you'll find answers to some of the most common questions. You can also get in touch using the comment box below to leave your own question about 0% purchase credit cards.
A 0% purchase rate offer lasts for a limited amount of time from when you first get the new credit card. During this introductory period, you won’t be charged interest on purchases as long as you pay the minimum amount listed on each statement.
In comparison, a credit card with interest-free days gives you a window of time in each statement period when you can make purchases without being charged interest. Usually, you need to pay the total amount owed on each statement to be eligible for interest-free days.
For the length of the 0% purchase promotion period, standard interest-free days offers do not apply. If your card comes with an interest-free days feature (say, for up to 55 days), then you'll be able to take advantage of this when the promotional period ends. Note that this type of interest-free period usually only applies if you pay your entire balance in full by the due date on each statement.
Once you've activated the credit card, all eligible purchases that you make will be interest-free until the end of the promotional period. However, any purchases that haven't been repaid by the end of the introductory period will collect interest after that.
Credit card annual fees are usually not considered eligible purchases. So if you get a promotional 0% purchase rate credit card that also has an annual fee, you'll probably be charged interest on that part of your balance. You can contact the individual credit card providers to find out if this fee would be eligible for a particular interest-free promotion. Alternatively, you may want to consider cards that offer no annual fee.
With this type of credit card, the promotional 0% interest rate is available for a fixed time period. For example, let's say you get a card offering 12 months interest-free on purchases from when you activate the card.
If you make a purchase on the day you get (and activate) your card, you will have 12 months to pay it off before interest is charged. If you make another purchase after three months, you will have nine months remaining for the 0% interest period, while if you make a purchase 11 months after getting the card, you'll only have one month interest-free for that purchase. After that, your 12-month interest-free offer will end with the interest rate reverting back to the standard purchase rate for that card.
After your 0% purchase promotion has finished, the outstanding balance from your purchases will be charged interest at the regular purchase rate, usually known as the "revert rate". You can consider moving your outstanding purchase amount to a 0% balance transfer credit card, which will give you more time to repay your debt interest-free.
These cards usually charge 0% interest on purchases for 3 to 15 months. You can sort the credit cards by "purchase rate" in the comparison table above to see which cards offer the longest interest-free period.
While you could be able to use your card to pay for utilities and government payments, these transactions are sometimes listed as ineligible for the 0% introductory interest rate offer. Check the offer details or contact the credit card company directly to confirm what types of transactions are eligible for the interest-free offer.
Amy is an editor and writer at finder.com.au with more than 10 years experience covering credit cards, personal finance and various lifestyle topics. When she’s not sharing her knowledge on money matters, Amy spends her time as an actress.
Could you please explain to me what “interest charged on purchases” means on my credit card statement? I always thought it was the interest charged on the balance when you did not pay the full balance by the due date. I have been paying the full balance by the due date every month and yet still being charged interest on every statement. I am a bit confused. It is a low fee card.
You can avoid paying interest when you pay the full balance by the due date and only use your credit card to make purchases. To read further into credit card statement dates, please refer to this comprehensive guide.
Given that you are being charged a fee while paying your balance in full, it would be best to contact your bank to review your statement carefully.
Typically, prepaid cards have expiration dates. You’ll need to be reissued a card after it expires. Funds on the cards don’t expire however some consumers complained that they had money on their cards when they expired but the issuer didn’t reissue cards that included those balances. If that happens to you, reach out to the prepaid company to see if it can be resolved.
Hope this helps! For any further questions, feel free to reach out to us again, we’re here to help!
Typically, banks do not offer promotions for cash advance interest on credit cards. So even if the card has zero interest on purchases, the card will still charge interest and fees on cash on advances each time you use that feature.
Thank you for contacting finder. We are a comparison website and general information service, we’re more than happy to offer general advice.
You may refer to this page for options that may suit your needs. You may review and compare the offers available on the table. Once you have selected one, you may proceed by clicking the green “Go to Site” button.
Basically, the eligible purchases are everyday purchases which involve the exchange of a good or service for a payment, which excludes business expenses, gambling transactions, balance transfers and cash advances. So it’s best to contact your bank or credit issuer directly to confirm if they would consider your payments for a club membership as eligible purchases.
I’m afraid no. The annual fee is basically fixed for the entire lifespan of the card and it’s not considered as a purchase, so the 0% interest does not apply to it.
Most Australian Banks with online banking facility can be linked to common accounting software. If you already have an accounting software, you can normally check which bank are supported when you try to ‘add a bank account.’ If you’ll let me know what accounting software you are using, I may be able to give you the exact procedure to do it.
I would like to purchase some furniture and utilise the 0% interest on purchases currently on offer. I can then put the money otherwise spent on my mortgage offset account and save on interest, for example.
If I want to maximise the limit on a new 0% purchase credit card, would it help if I lowered the limit on my current card first?
If you’re interested in applying for a credit card that offers 0% interest on purchases, you may do so. But please make sure to read the eligibility criteria and requirements before applying. Once you’ve found a card you’re eligible for and you wish to apply for, you can click “Go to Site” green button to head over to the credit card company’s website.
In the meantime, keep in mind though that your approved credit limit will be determined by the card issuer. Depending on their assessment on your ability to repay, income and credit score, they may approve you for a lower or higher credit limit.
What I’m trying to ask is, all else equal, will lowering the credit limit on my existing card immediately prior to applying for a new card (the 0% interest on purchases card) help me get a higher credit limit on the new card?
I want to effectively transfer as much of my credit limit to the new 0% on purchases card without cancelling my current card.
Unfortunately, transferring of credit limit between credit cards is not possible. As I mentioned in my previous reply, only the credit card issuer has the ability to give you a higher or lower credit limit – that is depending on certain criteria you met and not because you have a lower limit of your existing credit card. Please feel free to read our article on how you can increase your credit limit.
The 0% interest free period refers to a promotional period. So if you had a 0% on purchases for 6 months, your purchases wouldn’t collect interest for the first 6 months after that card is approved. After the promotional period, the standard interest rate will kick in.
The 44 interest-free days, on the other hand, is a permanent feature of the card that can only be taken advantage of if you pay your balance in full by the end of the statement period. If you’re able to do this, then your future purchases won’t collect interest for up to 44 days.
I hope this has helped and don’t hesitate to respond if you have any more questions.
If you’re self-employed and want to apply for a credit card for personal use, you’ll just need to ensure that you meet the eligibility requirements (including annual income, credit history etc) and provide evidence of your self-employment (such as your accountant’s details).
* The credit card offers compared on this page are chosen from a range of credit
cards finder.com.au has access to track details from and is not representative
of all the products available in the market. Products are displayed in no particular
order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are
subject to our disclaimer.
You should consider seeking independent financial advice and consider your own
personal financial circumstances when comparing cards.
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Could you please explain to me what “interest charged on purchases” means on my credit card statement? I always thought it was the interest charged on the balance when you did not pay the full balance by the due date. I have been paying the full balance by the due date every month and yet still being charged interest on every statement. I am a bit confused. It is a low fee card.
Hi Annette,
Thanks for your comment.
“interest charged on purchases”
You can avoid paying interest when you pay the full balance by the due date and only use your credit card to make purchases. To read further into credit card statement dates, please refer to this comprehensive guide.
Given that you are being charged a fee while paying your balance in full, it would be best to contact your bank to review your statement carefully.
Hope this helps!
Best,
Nikki
I have a prepaid visa card which I have not used for sometime.I tried to start using it again at a BP service station and it would notaccept it
Hi Howard,
Thanks for your inquiry.
Typically, prepaid cards have expiration dates. You’ll need to be reissued a card after it expires. Funds on the cards don’t expire however some consumers complained that they had money on their cards when they expired but the issuer didn’t reissue cards that included those balances. If that happens to you, reach out to the prepaid company to see if it can be resolved.
Hope this helps! For any further questions, feel free to reach out to us again, we’re here to help!
Best,
Nikki
Our card uses the cash advance facility from time to time.
If swapping for a nil interest credit card what will happen with those current cash advances on any new credit card?
Hi Ray,
Thanks for your question.
Typically, banks do not offer promotions for cash advance interest on credit cards. So even if the card has zero interest on purchases, the card will still charge interest and fees on cash on advances each time you use that feature.
Cheers,
May
Can you please advise which card/s are currently offering a 0% balance transfer, and have the best points system
Hi Eve,
Thank you for contacting finder. We are a comparison website and general information service, we’re more than happy to offer general advice.
You may refer to this page for options that may suit your needs. You may review and compare the offers available on the table. Once you have selected one, you may proceed by clicking the green “Go to Site” button.
I hope this helps.
Cheers,
Danielle
Hello.
Could you please tell me if sports club/golf membership fees are eligible for the 0% purchase fee CC purchases ?
Hi David,
Thank you for your inquiry.
Basically, the eligible purchases are everyday purchases which involve the exchange of a good or service for a payment, which excludes business expenses, gambling transactions, balance transfers and cash advances. So it’s best to contact your bank or credit issuer directly to confirm if they would consider your payments for a club membership as eligible purchases.
Cheers,
May
Hi,
Regarding 0% purchase credit card, will the annual credit card fee receive 0% interest free?
Regards
Hi Joe,
Thank you for your inquiry.
I’m afraid no. The annual fee is basically fixed for the entire lifespan of the card and it’s not considered as a purchase, so the 0% interest does not apply to it.
Cheers,
May
Hi,
In this age of cloud and automation, which bank card in the best deal and has the CSV format that is compatible to link up in accounting software.
Warm regards
Hi Barry,
Thanks for your question.
Most Australian Banks with online banking facility can be linked to common accounting software. If you already have an accounting software, you can normally check which bank are supported when you try to ‘add a bank account.’ If you’ll let me know what accounting software you are using, I may be able to give you the exact procedure to do it.
Cheers,
Anndy
Hi,
I would like to purchase some furniture and utilise the 0% interest on purchases currently on offer. I can then put the money otherwise spent on my mortgage offset account and save on interest, for example.
If I want to maximise the limit on a new 0% purchase credit card, would it help if I lowered the limit on my current card first?
Thanks.
Hi Ken,
Thanks for your inquiry.
If you’re interested in applying for a credit card that offers 0% interest on purchases, you may do so. But please make sure to read the eligibility criteria and requirements before applying. Once you’ve found a card you’re eligible for and you wish to apply for, you can click “Go to Site” green button to head over to the credit card company’s website.
In the meantime, keep in mind though that your approved credit limit will be determined by the card issuer. Depending on their assessment on your ability to repay, income and credit score, they may approve you for a lower or higher credit limit.
I hope this has helped.
Cheers,
May
Hi May, thanks for your response.
What I’m trying to ask is, all else equal, will lowering the credit limit on my existing card immediately prior to applying for a new card (the 0% interest on purchases card) help me get a higher credit limit on the new card?
I want to effectively transfer as much of my credit limit to the new 0% on purchases card without cancelling my current card.
Thanking you
Hi Ken,
Thanks for getting back.
Unfortunately, transferring of credit limit between credit cards is not possible. As I mentioned in my previous reply, only the credit card issuer has the ability to give you a higher or lower credit limit – that is depending on certain criteria you met and not because you have a lower limit of your existing credit card. Please feel free to read our article on how you can increase your credit limit.
I hope this has helped.
Cheers,
May
I am confused by the 0% interest free period and the 44 days interest free.
Sorry for probably stupid question.
Hi Steph,
Thanks for your question!
The 0% interest free period refers to a promotional period. So if you had a 0% on purchases for 6 months, your purchases wouldn’t collect interest for the first 6 months after that card is approved. After the promotional period, the standard interest rate will kick in.
The 44 interest-free days, on the other hand, is a permanent feature of the card that can only be taken advantage of if you pay your balance in full by the end of the statement period. If you’re able to do this, then your future purchases won’t collect interest for up to 44 days.
I hope this has helped and don’t hesitate to respond if you have any more questions.
Cheers,
Sally
Are there any cards available for personal use for a self-employed person? Do not want to use the card for business.
Hi Christine,
Thanks for your question.
If you’re self-employed and want to apply for a credit card for personal use, you’ll just need to ensure that you meet the eligibility requirements (including annual income, credit history etc) and provide evidence of your self-employment (such as your accountant’s details).
I hope this has helped.
Cheers,
Sally