Everything you need to know about 0% purchase credit cards
If used with care, a 0% on purchases credit card can be a useful way to buy bigger items and pay for them at a later date. Find out how this type of credit cards works, and how you can avoid racking up a debt that you’ll find hard to pay back.
Frequently asked questions
What is a 0% purchase credit card?
A 0% purchase credit card lets you buy items upfront and allows you to pay off the amount you’ve spent over a set period of time without any interest. If your debt is clear at the end of the pre-agreed 0% period, then you’ll pay no interest and the credit won’t have cost you anything.
What are the advantages of this type of card?
A card offering 0% on purchases can help you buy expensive items as you can spread the cost over a number of months or years without paying any interest. Once any ‘interest free’ period ends – typically a year or two, but this varies and could be longer – you’ll start to be charged interest on any outstanding balance. However and very importantly, you’ll only be able to benefit from not paying interest if you meet your minimum payment each month and pay back the outstanding amount before the 0% deal expires.
Another advantage is that buying items using a 0% purchase credit card could give you Section 75 protection for payments between £100 and £30,000. Read our guide to credit card security for more information.
What are some of the disadvantages of a 0% purchase card?
As with all types of credit cards, people can (and regularly do) get into significant debt problems if they misuse them, so you have to use your 0% purchase card with care. Be really clear on your credit limit and read about the charges you need to consider before getting a credit card. Or you could find out more about the pros and cons of credit cards, before comparing the types of card we offer.
What other 0% cards should I think about?
There are cards that offer 0% percent balance transfer, where you can move your debt from your current card to a new one without having to pay interest on the balance you’re transferring. However, you’re likely to have to pay a fee to move the balance, typically up to 3% of the amount borrowed.
You could also look at 0% balance transfer and purchase cards, which will allow you to move a balance interest-free and get 0% interest on your spending. You need to check the details carefully so that you know exactly how long the offers last for, and there may be other terms and conditions. Find out more about 0% balance transfer and purchase cards.
Don’t forget that applying for balance transfer cards to move debt (just as with any other credit card) will leave a record on your credit history, which could make it harder to take out other types of credit in the short term.
What else should I think about?
When comparing credit cards, it’s useful to take note of the APR for each card. The APR, or annual percentage rate, is the way lenders describe the cost of borrowing money over a year. Understanding the APR can help you understand how much it could cost you to use the card, and it’s just one way to compare how much it will cost you to use a credit card.
Let’s say the APR on a card is 17% and you spend £1,000 on it, the interest and charges will mean that you are accruing £170 on top of your £1,000 debt. In the end, then, you will be paying back £1,170.
Which credit card is right for me?
When used sensibly, a 0% purchase credit card can be a great way to spread the cost of larger items over a number of months. At Compare the Market we’re here to help find the credit card that works for you.
Compare 0% purchase credit cards in minutes to see if you can save.
Start a comparison