What is a cheque to self balance transfer? | Finder

What is a cheque-to-self?

The cheque-to-self offered by Citibank was a way to get an introductory low or 0% rate for debt or expenses that couldn’t be moved to a balance transfer credit card.

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As of October 2019, this option is no longer available in Australia. But, as you may still find references to cheque-to-self options online, below are the details of how this option worked.

In basic terms, a cheque-to-self was available through some balance transfer cards as an alternative to a conventional balance transfer. With this option, instead of transferring a balance from one account to another, you would request a cheque that you could use to pay off anything. The cheque amount you were issued then became the balance on your new credit card and was treated as a balance transfer. This meant you could get the benefit of a low or 0% interest rate during the introductory period.

Important information about cheque-to-self options

Before 1 October 2019, Citi was the only issuer in Australia that offered a cheque-to-self option on its balance transfer credit cards. This option is no longer available, meaning you cannot get a cheque-to-self balance transfer any more.

The information below has been kept for reference only.

When would a cheque-to-self be used instead of a balance transfer?

A cheque-to-self offered more flexibility than a regular balance transfer, so there are many scenarios when people might have considered this option. These include:

  • To pay off other types of debt. Some debts don't fall into one of the eligible balance transfer categories. For example, a balance with Afterpay or another interest-free shopping service won't be eligible unless it's classified as a line of credit (and many aren't).
  • For medical bills. If you needed to pay for surgery or other health costs upfront, a cheque-to-self balance transfer would have been a way to get the funds and save on interest charges for a set period of time. This could make it more affordable than using a regular credit card.
  • To pay for a mix of expenses. A cheque-to-self meant people could split the value of the cheque across a range of expenses. For example, some money could be used to pay for gifts during the holiday season, some for a holiday and some for property rates and fees.

A few people would also get a cheque-to-self and then deposit the money into a savings account or offset account. This strategy was designed to "earn" money on the value of the cheque. However, the value of the cheque would still technically be borrowed money – which meant this was a risky option that could end up costing a lot more than it was worth.

What other options are available for these scenarios?

While cheque-to-self balance transfers are not offered in Australia, you could consider a 0% p.a. purchase rate credit card for new purchases or a personal loan for existing and/or upcoming expenses. Just remember to compare your options and weigh up all the features and costs before deciding to apply.

Compare long-term balance transfer credit cards

Data updated regularly
$
% p.a.
Name Product Balance transfer rate Purchase rate Annual fee Amount saved
HSBC Platinum Credit Card
0% p.a. for 36 months
19.99% p.a.
$29 annual fee for the first year ($129 p.a. thereafter)
Save money with a 0% balance transfer rate for 36 months (with no BT fee), a first-year annual fee discount and free travel insurance.
St.George Vertigo Classic
0% p.a. for 28 months
13.99% p.a.
$55
Enjoy a 0% interest rate on balance transfers for 28 months, with no balance transfer fee.
Citi Rewards Card - Balance Transfer Offer
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.
Kogan Money Black Card - Exclusive Offer
0% p.a. for 24 months
20.99% p.a.
$0
Finder Exclusive
Save with a $0 annual fee and a 0% introductory rate on balance transfers. Plus, earn $50 Kogan.com Credit and uncapped rewards points. Ends 12 Apr 2021.
Westpac Low Rate Card
0% p.a. for 28 months with 1% balance transfer fee
13.74% p.a.
$0 annual fee for the first year ($59 p.a. thereafter)
Save with a $0 annual fee for the first year, plus, a 0% interest rate on balance transfers for 28 months.
ANZ Low Rate
0% p.a. for 20 months
12.49% p.a.
$0 annual fee for the first year ($58 p.a. thereafter)
Save with 0% p.a. on balance transfers for 20 months (with no BT fee) and $0 first-year annual fee. Plus a 12.49% p.a. purchase interest rate.
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
0% p.a. for 26 months
20.74% p.a.
$64 annual fee for the first year ($129 p.a. thereafter)
Get 0% p.a. for 26 months on balance transfers and a reduced first-year annual fee. Plus, $129 Virgin Australia Gift Voucher per year.
Bank of Melbourne Vertigo Classic
0% p.a. for 28 months
13.99% p.a.
$55
Save with a 0% interest on balance transfers for 28 months, with no balance transfer fee.
Citi Clear Card
0% p.a. for 15 months
14.99% p.a.
$49 annual fee for the first year ($99 p.a. thereafter)
Get $250 cashback when you spend $3,000 within the first 90 days. Plus, a 0% balance transfer offer and first-year annual fee discount.
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 20,000 bonus Flybuys points, a $0 first-year annual fee and 0% p.a. on balance transfers for 18 months (1.5% fee applies).
Citi Rewards Card - Bonus Points Offer
0% p.a. for 15 months
21.49% p.a.
$49 annual fee for the first year ($149 p.a. thereafter)
Get 100,000 bonus Citi reward Points (worth $460 in gift cards) when you spend $3,000 in the first 90 days. Plus, a $49 first-year annual fee.
Bendigo Bank Low Rate Credit Card
0% p.a. for 24 months with 2% balance transfer fee
11.99% p.a.
$45
Save with 0% p.a. on balance transfers for 24 months (with a 2% BT fee). Plus a 11.99% p.a. purchase interest rate.
St.George Amplify Platinum - Qantas
0% p.a. for 15 months with 1% balance transfer fee
19.74% p.a.
$99
Earn 60,000 bonus Qantas Points, plus enjoy 0% p.a. on balance transfers for 15 months with a 1% BT fee.
St.George Amplify Platinum
0% p.a. for 15 months with 1% balance transfer fee
19.74% p.a.
$99
Receive 80,000 bonus Amplify Points (worth $350 in eGift cards) when you spend $3,000 in the first 90 days. Plus, a 0% balance transfer offer.
St.George Vertigo Classic Rainbow
0% p.a. for 28 months
13.99% p.a.
$55
All the great low cost features of the Vertigo 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.
$149 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 0% 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)
Get 80,000 bonus Altitude Points (worth $350 in eGift cards) when you spend $3,000 in the first 90 days, and a first-year annual fee discount.
Citi Rewards Card - Points & Gift Card Offer
0% p.a. for 15 months
21.49% p.a.
$49 annual fee for the first year ($149 p.a. thereafter)
Receive 90,000 bonus Citi reward Points (worth $400 in gift cards) and a $100 Coles eGift Card when you spend $3,000 in the first 90 days.
Bank of Melbourne Amplify Platinum - Qantas
0% p.a. for 15 months with 1% balance transfer fee
19.74% p.a.
$99
Get 60,000 bonus Qantas Points when you spend $3,000 within the first 90 days.
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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What were the risks of getting a cheque-to-self?

As with any balance transfer or debt product, there were a number of potential pitfalls, including:

  • Not paying off the balance before the introductory period ends. When the low or 0% balance transfer period is over, any debt remaining would be charged interest at the standard rate. This could quickly lead to more debt.
  • Getting more money than you need. The higher the value of the cheque, the bigger your credit card balance would be when this option was available. This meant the minimum monthly repayments would be high, which could also have increased the risk of not paying it all off by the end of the introductory period.
  • Reducing your credit score. Every time you apply for a form of credit, a listing is added to your credit history. This can lower your credit score – especially if you have made several applications in a short amount of time. Your credit score is also affected by how much debt you're carrying, so the balance from a cheque-to-self could have had a negative impact until it was paid off.

How a balance transfer can affect your credit score

Images: Shutterstock

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