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Sometimes, you may need to pay off existing debt and make a large purchase at the same time, and it can be tricky to know whether to apply for one card or the other.

0% balance transfer and purchase credit cards, also known as "combo" or "dual" cards, allow you to do both on a single card. These cards combine the benefits of transferring existing debt and making new purchases, offering the convenience of managing both through one account.

Many of these cards come with 0% interest deals on both balance transfers and purchases, helping you save on interest while you pay off your debt or make new purchases. This can simplify your finances and make managing your spending easier.

Balance transfers and purchases are two different use cases for getting a credit card. But at times many people need the flexibility to do both and providers have responded by offering both functions in a single card.

Not only do you get access to both functions - balance transfers and purchases - you can simplify your finances by having one card. And you can rest assured that when you make a repayment, the higher interest debt is always paid off first.

However, the best part of these cards is that often you can get 0% interest deals on both balance transfers and purchases. So you're able to save on interest whether you're doing a balance transfer or making purchases.

How do balance transfer and purchase credit cards work?

Transfer your debt

--Move any existing credit card balances across to a new credit card that charges a lower rate of interest or charges 0% interest for a number of months. --

Pay the transfer fee

--When transferring a credit card balance to a new card, you’ll usually pay a transfer fee of up to around 3.5% of the total card balance you transfer.--

Save money

--Because your new credit card charges a lower interest rate, or even no interest at all for a set time, you’ll save money and also pay off your credit card balance faster.--

Interest-free spending

Your combo card will also offer a 0% interest deal on purchases, meaning you can spend on your card interest-free for a number of months.

Clear your debt before interest kicks in

It’s important to pay off both your balance transfer debt and your purchases debt before the 0% deals end and interest kicks in at a much higher rate. If you’re unable to, you might need to shift your remaining balance to another balance transfer credit card.

How to compare balance transfer and purchase credit cards

When trying to pick the best balance transfer and purchase card, there are three main features you need to watch out for:

Interest free period

--With a combo card, you'll need to look at the 0% period for both balance transfers and purchases because you typically don't get the same period for both.----On some cards the interest-free period for balance transfers might be longer, on others you might get a longer one for purchases.----You'll have to prioritise what you'll need more time for and choose a card accordingly.--

APR

--This is also known as the revert rate, or the interest rate you’ll be charged once the 0% interest period ends.----With a combo balance transfer and purchases credit card, you might find that the interest rate for a balance transfer is different from that for making purchases. So make sure you consider both when picking a card.--

Fees

--Most cards charge fees for different kinds of transactions. For example foreign transaction fees for using the card abroad. Or cash advance fees and interest for withdrawing cash from an ATM. If you’re unlikely to use your card for any of these, then it shouldn’t matter.-- --With combo cards, you'll likely have to pay a balance transfer fee. These are typically around 3% to 3.5% of the transfer amount.--

  • Check your eligibility. Once you've found a card you want, it makes sense to check you'll be accepted. Eligibility tools won't hurt your credit score and can let you see how likely you are to be accepted before you apply.

  • Try to pay more than the minimum repayment. For any purchases you make on your credit card, you are required to pay at least the minimum monthly repayment. However, minimum repayments are set at very low levels, so if you only pay this amount, you won't be able to repay your full balance before the 0% offer period ends. You’ll end up being charged the revert rate on the balance, which is much higher, meaning you’ll pay a lot more in interest and it will take a long time to clear your debt.

  • Take advantage of the entire offer period. The 0% offer is available as soon as your card is approved, not from when you make your first purchase or do a transfer. Make sure you carry out these transactions as soon as you get your credit card, and start making repayments to make the most of the interest-free period.

  • Avoid withdrawing cash. Not all credit card transactions are equal - in fact a whole string of them cost you more. These are known as cash advances, or cash like transactions, and you will be charged interest from the second you make the transaction, quite possibly at a higher APR than normal. You could also be charged a fee on top.

Balance transfer and purchase credit card FAQs

Balance transfer and purchase card jargon buster

About the author

Lucinda O'Brien profileLucinda O'Brien
Lucinda O'Brien has spent the past 10 years writing and editing content for regional and national titles. She applies her industry knowledge to ensure readers can make confident financial decisions.

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