What is a balance transfer?

Find out how a balance transfer credit card works and how you can use one to repay your debt faster.

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A balance transfer allows you to move your existing credit card debt to a new credit card with a lower or 0% rate of interest. This usually means you can repay your debt faster and save significantly on interest costs. There are many balance transfer offers on the market and the length of the promotional period can vary from 6 to 30 months. Once the introductory period ends, any remaining balances will start to collect interest at the standard purchase or cash advance rate.

You can use this guide to find out how balance transfers work, compare the features and benefits as well as understand how to compare different offers to find the right one for you.

What is a balance transfer credit card?

You can use a balance transfer to move your credit card debt onto a new card from a different lender. If you have several debts, you could also use a balance transfer to consolidate them under one account. Balance transfer credit cards usually offer a 0% interest rate for a promotional period, which can help you save money as you pay off the debt. At the end of the introductory period, you'll be charged a higher interest rate on any debt you have remaining from the transfer.

balance-transfer-process

Video: How do balance transfers work?

Key features and benefits of a balance transfer credit card

  • Introductory period. 0% balance transfer rates are only available for an introductory period which can last from 6 to 24 months (or sometimes longer) depending on the card. The promotional offer starts as soon as your card is activated, not as soon as you make your first repayment.
  • Revert rate. When the introductory period ends, the interest rate will revert to the standard purchase or cash advance rate. Considering the revert rate, it's best to repay your balance in full before the interest applies. Check out our guide for more information about balance transfer revert rates.
  • Balance transfer fees. When you first conduct a balance transfer, you may be required to pay a one-off balance transfer fee of 1% to 3% of the total amount you're moving to the new card.

Is a money transfer the same as a balance transfer?

No. A balance transfer is when you transfer the debt from your old card to a new one. A money transfer is sending money between two different accounts.

How much can you save on interest with a balance transfer?

You can use finder's balance transfer credit card calculator to discover how much you could save based on your current card's interest rate and the size of your debt. For example, let's say you have an outstanding balance of $5,000 that is collecting interest at 17.00% p.a. If you applied for a card with 0% for 12 months with no balance transfer fee or annual fee, you could save $850 in interest if you pay off the entire debt before the revert rate applies. That's $850 you could use to pay off your debt faster.

Compare balance transfer credit cards

Data indicated here is updated regularly
$
% p.a.
Name Product Balance transfer rate Purchase rate Annual fee Amount saved
St.George Vertigo Classic
0% p.a. for 24 months
13.99% p.a.
$0 annual fee for the first year ($55 p.a. thereafter)
Get 0% p.a. promotional balance transfer rate, with no balance transfer fee. Plus, save with a first-year annual fee waiver.
Citi Rewards Card
0% p.a. for 30 months
21.49% p.a.
$49 annual fee for the first year ($149 p.a. thereafter)
Save on interest with 0% p.a. on balance transfers for 30 months with no balance transfer fee. Plus, a $49 first-year annual fee.
Westpac Low Rate Card
0% p.a. for 24 months with 1% balance transfer fee
13.74% p.a.
$59
A low rate card offering 0% p.a. interest on balance transfers for the first 24 months and a $200 cashback offer.
Coles No Annual Fee Mastercard
0% p.a. for 12 months
0% p.a. for 12 months, reverts to 19.99% p.a.
$0
Save on new and existing interest charges with 0% p.a. on balance transfers and purchases for 12 months. Ends 31 January 2021.
ANZ Low Rate
0% p.a. for 25 months with 1.5% balance transfer fee
12.49% p.a.
$0 annual fee for the first year ($58 p.a. thereafter)
Save with 0% p.a. on balance transfers for 25 months (with a 1.5% BT fee) and $0 first-year annual fee. Plus a 12.49% p.a. purchase interest rate.
HSBC Platinum Credit Card - Balance Transfer Offer
0% p.a. for 26 months with 1% balance transfer fee
19.99% p.a.
$0 annual fee for the first year ($129 p.a. thereafter)
Enjoy a 26-month balance transfer offer, a first-year annual fee waiver and complimentary travel insurance.
Bank of Melbourne Vertigo Classic
0% p.a. for 24 months
13.99% p.a.
$0 annual fee for the first year ($55 p.a. thereafter)
Save with a 0% p.a. interest for 24 months on balance transfers, with no balance transfer fee. Plus, a $0 first-year annual fee.
Citi Clear Card
0.9% p.a. for 15 months
0.9% p.a. for 15 months, reverts to 14.99% p.a.
$99
Save with 0.9% p.a. for 15 months on purchases and balance transfers. Plus, complimentary purchase insurance cover.
Coles Rewards Mastercard
0% p.a. for 18 months with 1.5% balance transfer fee
19.99% p.a.
$0 annual fee for the first year ($99 p.a. thereafter)
Enjoy $100 off a Coles Supermarket, a $0 first-year annual fee and a 0% p.a. on balance transfers for 18 months (1.5% fee applies). Ends 31 Jan 2021.
St.George Amplify Platinum - Qantas
0% p.a. for 15 months with 1% balance transfer fee
19.74% p.a.
$99
Earn 70,000 bonus Qantas Points, plus enjoy 0% p.a. on balance transfers for 15 months and complimentary insurance covers.
St.George Amplify Platinum
0% p.a. for 22 months with 1.5% balance transfer fee
0% p.a. for 7 months, reverts to 19.74% p.a.
$0 annual fee for the first year ($99 p.a. thereafter)
Save with 0% p.a. interest rates on purchases and balance transfers. Plus a $0 first-year annual fee.
St.George Vertigo Classic Rainbow
0% p.a. for 24 months
13.99% p.a.
$0 annual fee for the first year ($55 p.a. thereafter)
All the great low cost features of the Vertigo Visa with a rainbow design in support of the LGBT community.
St.George Rainbow Vertigo Platinum
6.99% p.a. for 12 months
0% p.a. for 15 months, reverts to 12.99% p.a.
$49 annual fee for the first year ($99 p.a. thereafter)
All the platinum features of the Vertigo Platinum Visa with a rainbow design in support of the LGBT community.
Westpac Altitude Platinum Qantas
0% p.a. for 18 months with 1% balance transfer fee
20.49% p.a.
$99 annual fee for the first year ($200 p.a. thereafter)
Get 60,000 bonus Qantas Points when you spend $3,000 within 90 days. Plus, a first-year annual fee discount and a long-term balance transfer offer.
Westpac Altitude Platinum Card
0% p.a. for 18 months with 1% balance transfer fee
20.49% p.a.
$99 annual fee for the first year ($150 p.a. thereafter)
Earn 80,000 bonus Altitude Points when you spend $3,000 within 90 days. Plus, a first-year annual fee discount and a long-term balance transfer offer.
Bank of Melbourne Amplify Platinum - Qantas
0% p.a. for 15 months with 1% balance transfer fee
19.74% p.a.
$99
Receive 70,000 bonus Qantas Points when you spend $1,500 each month for the first 3 months and earn up to 0.5 Qantas Points per $1 spent.
Bankwest Breeze Classic Mastercard
0% p.a. for 26 months with 2% balance transfer fee
10.99% p.a.
$0 annual fee for the first year ($49 p.a. thereafter)
Save with 0% p.a. on balance transfers for 26 months (with a 2% BT fee) and $0 first-year annual fee. Plus, a 10.99% p.a. purchase interest rate.
Bankwest Breeze Platinum Mastercard
0% p.a. for 26 months with 2% balance transfer fee
10.99% p.a.
$0 annual fee for the first year ($69 p.a. thereafter)
Get 0% interest on balance transfers for 26 months, a $0 first-year annual fee, complimentary travel insurance and no foreign transaction fees.
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How to use the balance transfer calculator to see how much money you could save

Step 1. Enter the total debt/outstanding amount you would like to transfer
Step 2. Provide the interest rate that you are paying on your existing debt (if you don't have your interest rate at the top of your head, the average is around 18-20%)
Step 3. See the 'Amount Saved' column to find out which credit cards will save you the most money. The calculator automatically factors in any balance transfer fees and annual fees associated with each card. Click on the 'Amount Saved' title to sort the cards in ascending or descending order of money saved
Step 4. Compare the credit cards available in the table provided to find the card that suits your needs. If you still want to find out more about a particular credit card, click the ‘More info’ link for a full review on the features and benefits.

finder-balance-transfer-calculator

Frequently asked questions

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6 Responses

    Default Gravatar
    AidinMarch 10, 2019

    Hi,
    Does balance transfer affect my credit score?
    Thanks,
    Aidin

      Avatarfinder Customer Care
      JohnMarch 11, 2019Staff

      Hi Aidin,

      Thank you for reaching out to Finder.

      A balance transfer can be a good way to pay down debt. But, depending on several factors, balance transfers can either help your credit score or hurt it. In the long run, balance transfers can improve your credit score if the transfer makes it easier and faster to pay down your outstanding debt. Of course, you will make those payments on time – a crucial part of maintaining a good credit score. Hope this helps!

      Cheers,
      Reggie

    Default Gravatar
    AndrewOctober 24, 2018

    I have an ANZ rewards card. I’m looking to transfer the balance to a Virgin card (to get the Velocity points). After 3 months, I’d like to transfer any balance back to the ANZ card and continue using that. When I do that, will ANZ treat that entire balance as outstanding and charge interest on it?
    (note – I always pay the closing balance each month to avoid interest, but there’s always some balance on the card at any given time).

    Just want to know if this is a wise strategy to get some extra points quickly

    Hope this makes sense.

    Andrew

      Avatarfinder Customer Care
      JeniOctober 25, 2018Staff

      Hi Andrew,

      Thank you for getting in touch with finder.

      Please see answers to your query below.

      1. I have an ANZ rewards card. I’m looking to transfer the balance to a Virgin card (to get the Velocity points).
      – Please note that balance transfer do not earn Rewards Points. When you use your Virgin Velocity credit card, points are earned on everyday purchases only. Cash like transactions as well as balance transfer don’t earn points.

      2. After 3 months, I’d like to transfer any balance back to the ANZ card and continue using that. When I do that, will ANZ treat that entire balance as outstanding and charge interest on it?
      – If you transfer the balance back to ANZ without any BT promotional offer, the entire balance will be charged on the card’s purchase rate or cash advance rate p.a. – whichever is the BT rate. Basically, this part is discussed if you request a balance transfer with your existing ANZ card.

      I hope this helps.

      Please feel free to reach out to us if you have any other enquiries.

      Thank you and have a wonderful day!

      Cheers,
      Jeni

    Default Gravatar
    DaniMay 14, 2015

    What are some features you should look for if you want to use a credit card?

      Avatarfinder Customer Care
      JonathanMay 14, 2015Staff

      Hi Dani, thanks for your inquiry!

      You may like to refer to this page which will provide a guide on choosing a credit card and the different features you may be looking for.

      Cheers,

      Jonathan

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