Focus on: New! Leading 18-month 0% purchase card from Tesco

Credit card providers have raised their game over recent months, launching lengthier interest-free deals onto the market. But, while balance transfers have been getting most of the glory, competition is also hotting up for cards offering 0% on purchases.


We take a look at the new-and-improved Tesco Clubcard Credit Card for purchases, which now offers a market-leading 18 months interest-free on all new spending.

What's the deal?

The Tesco Clubcard purchase credit card offers an impressive 18 months 0% on new purchases – up from its previous 16. This means you can spend on your plastic and pay no interest on that debt for a year-and-a-half.

The move by Tesco Bank means that it now offers the longest 0% purchase credit card on the market, having pushed Halifax's Purchase credit card, (which offers 0% on new spending for 17 months) down a notch on the tables.

The Tesco credit card also allows you to earn Clubcard points as you spend. You'll earn five Clubcard points for every £4 you spend in Tesco stores and petrol forecourts, and one Clubcard point for every £4 you spend elsewhere. In addition, the card offers interest-free balance transfers for nine months, with a 2.9% transfer fee.

However, if transferring debt to a 0% balance transfer card is your priority, Tesco has also improved its credit card for these purposes too. It is now offering a joint market-leading 27 months on its Clubcard credit card for balance transfers, with a fee of 3.15%.

Who's it good for?

The Tesco Clubcard purchase credit card is ideal for anyone who has a big purchase coming up, or a series of smaller ones, and would like to spread the cost over a number of months without paying interest.

It's also a good option for those who regularly shop at Tesco and want to build up their Clubcard points. These can then be redeemed on days out, flights, eating out and essentials for the home.

Any catches?

The biggest catch with the Tesco credit card is that you'll only be offered the 18-month interest-free shelter if you have an excellent credit rating.

It's therefore worth checking your credit score before you apply for the card which you can do through our credit monitoring channel. Our Eligibility Checker tool also gives you an idea of the credit cards you're more likely to be accepted for.

As with all credit cards of this type, you must also ensure you've cleared your balance before the 0% shelter on the Tesco card ends, no matter whether you've used the card for purchases or balance transfers. (Remember that the balance transfer 0% deal ends after nine months.) If you don't pay off your balance in time, you'll be hit with a representative annual percentage rate (APR) of 16.9% (variable).

What’s the verdict?

If a large purchase is looming and you know you'll struggle to pay off your credit card balance in full, the Tesco Clubcard purchase credit card is offering the market's longest 0% shelter for spending.

Keen Tesco shoppers are also likely to be attracted to this deal as they will be able to rack up Clubcard points much more quickly.
However, should you want to spend over an unlimited timeframe, you might prefer to plump for a card that offers a low rate of interest instead.

The Sainsbury's Nectar Low Rate Credit Card, for example, offers Nectar card holders a representative APR of 7.8% (variable) on both purchases and balance transfers and you'll be able to collect Nectar points as you shop.

The Sainsbury's Cashback Low Rate Credit Card has the same representative APR of 7.8% (variable) on balance transfers and purchases, but rather than earn Nectar points, you will earn cashback at a rate of 5.00% in the first three months. You will also receive an ongoing rate of £5 cashback every month you spend £500 or more on shopping, £250 of which must be at Sainsbury's.

Top tip!

As well as giving you the opportunity to spend interest-free, using a credit card entitles you to purchase protection through the Consumer Credit Act and Consumer Credit Directive.

This means that if you spend between £100 and £60,260 on your card, the provider and the supplier are jointly liable should your goods be damaged, faulty or fail to even show up. This applies even if you have only put a deposit on the card.

Remember, however, that if you are applying for a credit card that offers 0% on purchases, you need to be sure you can pay off your balance in full before the 0% deal ends – don't be tempted to spend more than you can afford to pay back.

Please note: Any rates or deals mentioned in this article were available at the time of writing

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