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 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.
Westpac Altitude Platinum Credit Card - Existing Customer Offer
6.99% p.a. for 12 months
20.49% p.a.
$0 annual fee for the first year ($150 p.a. thereafter)
Westpac customers only: Earn 100,000 bonus Altitude Points when you spend $3,000 within 90 days. Plus, a first-year annual fee waiver.
Westpac Altitude Platinum Qantas – Existing Customer Offer
6.99% p.a. for 12 months
20.49% p.a.
$50 annual fee for the first year ($200 p.a. thereafter)
Westpac customers only: Get 75,000 bonus Qantas Points when you spend $3,000 within 90 days. Plus, $50 first-year annual fee.
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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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