What is a purchase credit card?

Find out everything you need to know about purchase credit cards.

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A 0% interest purchase credit card lets you spend without accruing any interest for a set period of time. It can be a useful way to buy something expensive upfront, while using the promotional period to repay the balance in manageable monthly repayments.

What are the advantages of a purchase credit card?

Purchase credit cards are a bit like borrowing money for free, as long as you make sure that you keep up your monthly repayments, and pay off the whole balance before the end of the 0% interest-free period. Here are a few of the main benefits associated with a purchase credit card:

  • Added rewards on offer: Some lenders include loyalty points, cashback and promotional vouchers as part of their deal.
  • Staggered repayments: If you opt for a purchase card with a long 0% interest period, you can gradually pay off the cost of your purchase in an affordable and cost effective way.
  • Protection on your purchases: Under Section 75 of the Consumer Credit Act, credit card providers must provide protection for purchases between the cost to £100 and £30,000. You can read more about credit card protection here.

What to watch out for

Before applying for a purchase card, it’s important to check your credit score. Your credit score is used by lenders to determine whether your application is accepted or not. You can get your credit score for free through MoneySuperMarket’s Credit Monitor app.

Check and understand your report

As well as providing you with your full credit report for free, Credit Monitor also showcases the credit cards you are likely to get. Alongside this, the interest rate you are likely to get is shown to you, taking away some of the uncertainty surrounding your application.

See credit cards you are guaranteed to get

If you’re after the most competitive purchase card on the market, but your credit score isn’t high, Credit Monitor provides personalised tips and actions that could help you improve your score. If your score starts to climb, so will the range of credit card you’re likely to get.

Once you’ve chosen the purchase card for you, it’s worth bearing in mind the following:

  • Length of your 0% interest period: Make sure your interest-free period provides you with enough time to repay what you owe. When your promotional period is over, the interest accrued on your balance could make your repayments significantly more expensive.
  • Making your payments on time: Make sure you keep on top of your repayments otherwise your lender might withdraw your 0% deal and you could be charged expensive late fees.

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