Balance Transfer Credit Card South Africa

By: EconomyWatch Content   Date: 29 January 2010

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Credit cards are a big business today with banks and providers making a fortune off finance charges. The APR on most credit cards hovers around 16%. With that kind of interest levied on the card holder, it’s tough to pay off the dues within the specified date. Balance transfer thus evolved which is a transfer of a current amount owed in one credit card to another one, subject to a rate of interest. Many companies offer a free balance transfer in order to lure customers to using their services. Balance transfer on credit cards in South Africa is quite popular due to the low rates of interest on the transferred balance. For most customers in South Africa, balance transfers are ideal ways to reduce their credit card debts.

Balance Transfer Credit Card South Africa: Some Tips

 

Although, the concept of a balance transfer is quite simple, there are some steps involved in moving the amount from one card to another. The Credit Cards Regulation Reforms passed in December 2008 made credit more expensive for everyone with the phased elimination of the 0% balance transfer rate. Still, regardless of the transfer rate, it is essential for you to do some groundwork before committing to a balance transfer. Some tips for this process are mentioned below:

·        Firstly, consider your credit situation. If you have a solid credit history with a record of consistent on-time payments, you are likely to qualify for a low interest credit card where you can transfer your outstanding balances on your previous card. This will save you a lot of money in interest charges.

 

·        Secondly, consider the amount of money you are planning to transfer. For example, if you have R50, 000 in outstanding balances on one or more credit cards, it is unlikely you can move the entire amount into a low interest credit card. If you can transfer a small portion of the outstanding amount, it still is a productive step towards lowering your overall interest costs. So, it is important to weigh your options and the amount you are likely to transfer.

·        Lastly, you should consider the fees that are charged to you when transferring balances from one card to another. Unless it’s stated that no up front charges exist, balance transfer fees are always there. Read the fine print before you encounter any shock.

 

 

 

 


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