Best Credit Cards in the UK – Full Guide 2020 to make your money go further

By | Last Updated: 17th September 2019 | This post may contain Affiliate Links

Are you thinking about applying for a Credit Card? If so this fantastic section is ideal for you. Here you’ll find everything you need to know, from 0% balance credit cards, reward cards, cashback cards and more!

As all of our spending habits and budgets are different from one another, only you can make the decision about which card is correct for your needs. This website is jam-packed full of helpful guides and content, so what are you waiting for?

Why Get a Credit Card?

Credit Cards are basically a type of loan, they’re a popular method of finance for a lot of people throughout the world. When purchasing a product, the money gets borrowed from the card provider rather than taken from a personal bank account.

This means the card holder gets charged an interest rate on the money they have borrowed, the original amount and any interest rate which may have been applied needs to be paid back. Some people ‘clean’ their credit card debt at the end of each month, while others pay off their cards over a longer period of time.

You’ll find that a lot of banks and card providers offer incentives such as 0% Credit Cards or time-limited interest-free deals. Usually people ‘chop and change’ between providers to get the best rate to suit their needs and budget.

Credit Card’s are generally used for a wide range of reasons from weekly shopping to buying clothing. They can also be used for large purchases such as holidays, furniture or even buying new cars. Typically, they’re used to make purchases when you might not have cash readily available, the idea is to place an expensive purchase onto a credit card allowing the buyer to make small monthly payments against the debt.

By selecting a card with a low interest rate, the card holder can sometimes earn rewards and cashback on purchases they make. There’s lots of card providers in the UK including high street banks, building society’s and dedicated companies.

Types of Credits Cards available in the UK

With so much choice on the market, there can sometimes be too many options. Finding the right choice for your budget and requirements is important, you need to think about how much you can afford, your spending habits and your credit history.

To make things easily, please check out some of our helpful guides below for further information:

0% Purchase Credit Cards – A 0% Credit Card charges zero interest on purchases you make. This means you can ‘spread the cost’ of buying the items over a period of time. This type of card can sometimes be ideal if you’re thinking about getting a large item or if you plan to use your card on a regular basis, such as shopping online.

0% Balance Transfer Cards – This type of card allows you to ‘transfer’ debts from an existing card with a high interest rate to another without having to pay any interest on the debt. Usually there is a fee for doing this, however it’s ‘usually’ worth paying and is generally less than the interest on your old card. Disclaimer: Please see all documentation and consider your personal circumstances before entering into any agreements. No two people will have the same budget and requirements.

Reward / Cashback Credit Cards – If you shop a lot and like to ‘clear’ your balance at the end of each month, a reward card (can also be known as a cashback card) may be ideal for you. As you’re paying off your balance in full each month, the interest rate becomes irrelevant, this means you should look for a provider which offers rewards and deals for your responsible spending. Some ‘rewards’ can include store credit, air miles, holidays and so on.

Overseas Credit Cards – Ideal for business people or those who like adventure outside of the United Kingdom, an overseas spending card usually charge no or low fees for use abroad.

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How do Credit Cards Work?

Applying for a credit card can sometimes feel like a challenging process, however it’s quite simple. Typically, you apply to borrow money from the card issuer, this is usually your bank or building society. After receiving your application, the issuer will then look at your credit history and consider your application in more detail.

Lots of different criteria are considered before being accepted for a card and not every provider uses the same methods. Sometimes people with a low credit history can be refused credit, people who are ‘over-stretched’ may be rejected or even could be offered a higher interest rate. This all varies on an individual basis and no two applications are the same. That’s why it can be a good idea to ‘shop around’ to get the best interest rate for your own requirements.

Generally, if you have a good credit rating you will be accepted for a card and the issuing company will set a credit limit. Once again, this limit can vary massively, some people may only have a £1,000 credit limit, where others may have £50,000.

At the end of every month, the credit card provider will send a statement, detailing all the purchases you have made, this will include the total amount owed including any interest (if applicable). Normally you’ll find that your credit agreement may stipulate a ‘minimum payment’ which needs to be made each month.

It’s important to remember that applying for ‘too many’ credit cards in a short period of time, may have a negative effect on your credit rating, thus you may end up being rejected automatically for credit.

UK Credit Card

Borrow Money with No Interest

There’s an old myth which goes by ‘nothing is for free’, however if you’re thinking about applying for an interest-free credit card, then purchasing an item really can be for free (for a limited time).

For example, let’s say you’re thinking about purchasing a new bed or mattress and the cost is £600. For most people that’s a good chunk of their monthly wage, saving up for a bed can be tricky, after all, we all need to sleep.

You take out of your pocket, your brand new interest-free credit card, the current interest-free period lasts for 90 days. This means if you pay the balance in full before the end of the 90 days, you will have no interest to pay. Obviously one large payment of £600 can easily be broken down into smaller payments of £200 for three months.

As stated previously all card providers will offer different interest rates, time-periods and conditions, the above situation is a fictional example. Read all documentation carefully before entering into any agreement to make sure it suits your needs and requirements.

Frequently Asked Questions

Have you got a question about UK Credit Cards? If you have we may have answered your query below! Remember as well as this fantastic page, we also have other great sections too! This website is filled with helpful guides and information for British consumers. So after you’ve read this section click on one of the links to explore some more!

Can I get a Credit Card with a Poor Credit Score?
The answer is ‘it depends’ on how bad your credit history is. Typically, you’ll be offered some type of deal, however it won’t be at attractive rates. This is because you’ll be seen as a higher risk to lenders compared to people with a good credit score. Equally in some cases you will be turned down altogether and won’t be accepted at all. However, like most things, you don’t know which company will and won’t accept you until you apply.

If you’re interested in applying for a credit card, click Here to visit our fantastic section dedicated to the latest deals and offers from UK banks and financial providers.

Do I always have to pay interest when using my Credit Card?
It depends how you use your card, if you’re ‘on top’ of your spending habits and pay off the balance in full at the end of each month, you typically won’t pay any interest at all.

If you don’t pay your balance off at the end of each month but make the agreed ‘minimum monthly payment’ then interest naturally will be added onto your account, thus you’ll end up owning more money in the long run.

What is a Balance Transfer?
A balance transfer means you can transfer the balance from one credit card to another. If you select a new 0% balance transfer card, this ultimately gives you more time to pay off your existing debt. To learn more about Balance Transfer Cards, please click on the link for our expert guide.

What is APR?
APR stands for annual percentage rate and is fundamentally the ‘cost of borrowing money’ on your credit card if you don’t pay off the balance in full each month.

Equally it’s also important to differentiate between ‘representative’ and ‘actual’ APR. The representative APR is the advertised rate, but this is only the rate that is given to at least 51% of customers. As each customer is assessed differently based on their unique circumstances and credit rating, the actual rates offered may vary from those advertised.

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