Millions of credit card users across the UK are losing almost £2,000 a year by making one common and costly financial error, according to new analysis.
The £1,931 Savings Opportunity
Financial experts at TotallyMoney have calculated that individuals could save a substantial £1,931 by correcting this mistake. The figure is based on the average interest-bearing credit card balance of £3,002.
The key to unlocking these savings lies in utilising a balance transfer credit card. This financial product allows holders to move existing debt to a new provider, typically offering a lengthy period of 0% interest. This enables customers to focus on repaying the principal debt without accruing further interest charges.
How Balance Transfers Work to Slash Debt
With data showing that almost half of all credit card customers pay interest each month, a strategic balance transfer can be a powerful debt-clearing tool. The process involves shifting your current credit card balance to a new card that provides an interest-free window, often lasting for many months.
While there is usually a one-off transfer fee—typically between 2% and 4% of the moved balance—this cost is almost always far lower than the cumulative interest that would otherwise be paid over time. Once the transfer is complete, every repayment made goes directly towards reducing the debt itself.
Current Market-Leading Offers
The market for these deals is highly competitive, with several major providers offering compelling terms right now:
- TSB currently leads the pack with an offer of up to 38 months interest-free (until March 2029) on balance transfers, with a fee of 3.49%.
- MBNA provides a 36-month interest-free period with a slightly lower fee of 3.29%, which could generate savings of up to £1,830.
- Vanquis offers 19 months interest-free at a 3.48% fee.
- Barclaycard has a 14-month interest-free option, with some deals featuring fee-free transfers.
Alastair Douglas, CEO of TotallyMoney, urged consumers to explore their options. "Finding out if you’re eligible for an offer doesn’t take long, and it could save you hundreds – if not thousands of pounds," he said.
He also advised shoppers to seek out specific guarantees: "Always look out for offers which come with pre-approval, guaranteed credit limits, guaranteed rates, and guaranteed 0% offer durations. That way you’ll know if you’ll be accepted before you apply, and you can be totally sure that you’ll get exactly what was advertised."
For those carrying credit card debt, taking a few minutes to research and apply for a balance transfer deal could result in significant annual savings, turning a persistent financial drain into a manageable repayment plan.
