March 27, 2006

By Peter Kenny

There is a new credit card available from Capital One. This new platinum credit card comes with the longest 0% balance transfer term opportunity in the UK, 15 months.

On the surface this 15 month 0 per cent balance transfer deal is quite spectacular, but do not go rushing to apply just yet. To qualify for the 15-month deal you need to spend a minimum of £100 on your new Capital One platinum credit card before July 1st 2006.

The £100 expenditure requirement may look like a fair price to pay in order to get the 15 month 0 per cent deal, however, it must be remembered how Capital One allocate payments made to your account. As with many credit card providers any payments made to account are used to pay off the lowest interest bearing items first.

Suddenly the £100 you need to spend in order to have access to the 15 month 0% deal starts to become a much higher figure. The £100 will sit in your account accruing interest at 15.9 per cent APR and any payments made to your account will be taken off the balance you transferred to the Capital One card.

This sting in the tail has another nasty surprise, an open ended balance transfer fee of 2%. Most credit card companies have brought in a balance transfer fee due to lost profits caused by consumers switching to take advantage of 0 per cent deals. The open ended balance transfer fee means that there is no maximum charge, while other card providers will cap this charge to £49/£50.

Credit card companies will continue to try and entice new customers to take out their with, at first glance, good offers. We would always ask consumers to study the small print and take on board all charges that will be made to their account.

For more information on the new Capital One credit card please click here