Understanding Zero Balance Credit Cards Transfer

Zero Balance Credit Cards

Is the interest on the outstanding balance of your current credit card hurting you?

Are you are facing difficulty in managing too many credit cards and don’t want to throw them?

If the answer to the above questions is yes, then zero balance transfer credit cards can be the best option for you. This is an innovative way to consolidate and pay off your credit card bills without any help of a professional

Getting started with 0% transfer credit cards

Credit Cards have recently become a status symbol for many Indians. But it has been seen in the past that the credit card holders are not been able to clear their debts in time.

For this, with the permission of RBI some banks like HDFC Bank and Axis Bank now offer 0% balance transfer credit cards where the card holder can pay the original amount and can transfer it to another credit card without paying any interest for a considerable period.

Credit circulates in millions of dollars every day in the finance market ranging from loans to plastic money wiz credit cards. Making a mark in the credit money for public, 0% balance transfer credit cards have briskly grown their market in recent times.

What really excites about 0% balance transfer credit card is that it is rare knowledge among the general public.

There are different plans available with various banks

Example: Axis Bank offers two exciting plans under balance transfer plan (as of this article print date)

One of the Balance Transfer plan offers 0% interest rate for first 3 months and 2.95% interest rate after 3 months and the processing fees would be 2% or Rs 199 whichever is higher.

The second plan charges you 0.75% interest rate for first 6 months and 2.95% after 6 months and 1% processing fees or Rs 100 whichever is higher. The below illustration is in context with the second plan offered by Axis Bank

Saving on Axis Bank Balance Transfer offer on Rs. 10,000 Amount in Rs.
Normal interest@2.95% for 6 months on Rs. 10,000 1770
Axis Bank Balance Transfer interest @ 0.75% for first 6 months on Rs. 10,000 450
Your Saving on Rs. 10,000 1320

Source: Axis Bank Website

Advantages of 0% balance transfer credit cards

  • Considering it as the high end solution for the consumers, banks and other financial institutions have relished their policies against these cards. However, the situation is still demanding in the favour of consumers.
  • The major advantage is that you can accumulate all your debts in one card.
  • The transfer of debts in one card will save your money from different interest rates and formulates an understandable format to work upon.
  • 0% interest rate carries a much higher percentage of paying out the debts in time.
  • Once again saving you with the higher interest rate would save your Annual Percentage Rate, which is considerably a good part of your original amount.

Considerations before applying for 0% balance transfer credit card

  • Regarding 0% balance transfer credit cards there are enormous rules and guidelines that are mentioned in the contract. However, some of them are important to your interest and must be considered.
  • Closely mentor the period of 0% interest rate mentioned in the contract. This is because 0% interest rate is not allowed for a lifetime.
  • The next thing to consider is the later charges to be applied after 0% interest rate period expires. In many cases the interest charged after the 0% rate period very high.
  • Calculate the charges accumulated on the transfer and then transfer the payable debts. If the current debts have low rates then avoid the transfer.
  • Focus on the task of eliminating the current position of recurring debts. Transfer only that amount which will not reflect you in the future as constraint, this is because some of the cards stick some allegation after the transfer being done for the future spending.


The main objective of having 0% balance transfer credit card is to repay your recurring debts without paying any interest rates. However, this sole objective should go through some major considerations regarding several later purchase charges.

This phenomenon has a great advantage to card holders now but has also some paybacks. These paybacks are in the form of transfer charges, time period of 0% interest rate and later purchase.

So considering all these situations the main constraint is to have serious information about the 0% balance transfer credit cards and wise use is the best solution to move forward.

About the Author

Vaibhav Sangli is an MBA Finance who loves to write on several topics including insurance and mutual funds and finding out different ways to earn and spend money.

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