March 1, 2006

HSBC has just announced that it plans to cut it’s current credit card promotional offers which will come as bad news to “rate tarts”

The current HSBC credit card comes with a whopping nine months of zero per cent in balance transfers and purchases. HSBC now plan to reduce this offer to six months.

This move is seen as significant in the major Banks and credit card companies battle to regain profits lost to consumers who use zero per cent credit card deals to reduce their exposure to paying interest. These consumers constantly change whenever their current zero per cent deal expires, hence the name “rate tart”

The decision by HSBC to reduce their promotional term from nine months to six comes at the same time as the Halifax / Bank of Scotland move in cutting their zero per cent deal on purchases from twelve months to three.

HSBC have also increase their standard APR from 13.9% to 14.9%.

It is believed that this is just the latest in moves being taken by major banks and credit companies to claw back some of the profits they have lost over the last 18 months.

The season for the “rate tart” looks to be over as more and more are cutting their zero per cent deals and are looking at building a more long term relationship with their credit card holders.