Interest-Free Period Credit Cards

The vast majority of credit cards are interest-free period credit cards. If you find one that isn’t, it had better have some seriously attractive features elsewhere to compensate.

The way the interest-free period works is to enable the customer to pay for goods or services on credit, and not be charged any interest on them. Whilst that sounds fantastic, there are naturally going to be provisos attached, and the canny customer must be aware of these if they are to enjoy all the advantages and none of the disadvantages of credit card ownership.

Featured Interest-Free Credit Card

The Citibank Clear Platinum Visa currently has an interest free offer on balance transfers you can take advantage off. This card is ideal to transfer your balance onto and to pay off any credit card debts you have

• $99 annual fee
• 11.49% p.a. on purchases
• 0% p.a. for 7 months on balance transfers
• Cash Advance Rate of 21.24%
• Minimum Income Requirement of $50,000 p.a.
• Comes with a range of complimentary insurance cover

Click here to read the Citibank Clear Platinum Visa Card terms and conditions

When interest-free credit cards work well:

Interest-free period credit cards normally offer either forty-four days, or fifty-five days interest-free on purchases. That means that if you make your purchase on the first day of your new statement period, you will enjoy the full amount of days interest-free. Alternatively, if your purchase is made on the very last day countable for that month’s statement, you will have less days interest-free because the due date for full payment of the debt is obviously closer.

Anyone who is clearing their balance in full every month is making perfect use of their interest-free period credit card. This full repayment requirement to continue receiving interest-free days is in the Terms & Conditions of the credit card.

When interest-free credit cards stall:

Whether you continue to enjoy interest-free days is entirely down to the use you put your credit card to, and how effectively you manage your debt on a month-to-month basis. If you consistently retain an unpaid balance on your credit card, for whatever reason, you will not be eligible for any interest-free days for the month that follows. That means any new purchases you make will start accruing interest from the day they are made. This is when problems can start.

You should also know that there are certain transactions that are never subject to interest-free days, and those are cash transactions. These include ATM withdrawals, cashback from merchants, buying traveller’s cheques and foreign currency, and any gambling transactions made on your credit card. These will all start building interest from the day they are made, and they are very likely to attract a cash-handling fee to boot. They will also be charged at a higher rate than your purchases.

Balance transfers are also not normally subject to any interest-free days, unless, of course, they are set at an offer rate of 0% for a certain period of time. Apart from that, if you make a balance transfer to an interest-free period credit card, you will automatically void those interest-free days for any and all purchases until the balance is paid off in full.

• Comparison of Top 10 Credit Card Offers

Editor's Choice: Our Top Credit Cards

Credit Card	Card Details	Interest Rate (p.a.)	Cash Advance Rate (p.a.)	Balance Transfer Rate (p.a.)	Annual fee	Interest free days (up to)
HSBC Credit Card	Editor's Choice: 0% for 6 months Balance Transfer & No Annual Fee Featuring a $0 annual fee for life, and 0% p.a. balance transfer for 6 months, the HSBC Credit Card was voted the Best Transactor Credit Card for 2010.	16.99%	20.75%	0% for 6 months	$0	55
Suncorp Clear Options Standard Visa Card	A great 12 month balance transfer offer, combined with a low annual fee and a good interest rate on purchases.	12.24%	17.99%	1.9% for 12 months	$39	0