Choosing a credit card
When it comes to credit, making an informed decision is important.
This section will give you a much better understanding of the things you need to take into consideration before choosing a card.
Annual Percentage Rate (APR) - tells you how much your borrowing will cost over an average year.
It takes into account interest charged as well as any additional fees you'll have to pay (such as any annual fees). This figure is given to allow you to make an easy and fair comparison between different credit cards.
Balance transfer - is the process of transferring a balance from one credit card to another.
Balance transfers can help consolidate your debts into one place and often promotional rates may be offered which help to reduce the cost in the short term. Normally you will be charged a fee for this type of transaction. After a promotional rate has finished the balance will always go back to your standard rate, which will normally be higher.
Fees and Charges - Credit card providers may charge fees when using your card for:
- cash transactions
- non-sterling transactions
- non promotional balance transfers and money transfers
- statement copy fees.
You could pay an annual fee just for having a card, regardless of how much you spend. A single transaction may attract more than one fee. For example, for a cash transaction in a foreign currency we charge a cash transaction and a non-sterling fee.
Keep in mind that we do charge interest on fees, except annual fees, purchases during the interest free period and default charges. For awareness, no interest will be charged on default charges within the first 28 days after notice is given that these are payable. After this time interest will be charged.
Default charges may apply if:
- you miss or make a late payment
- you go over your credit limit
- your payment is returned unpaid.
Types of card
Credit cards can fall under a few different categories. Understanding these will help you to decide the type of card you are looking for. Here are some of the types of cards that we have to offer.
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Purchase Offer
A Purchase card is often used for purchasing everyday goods or services and will often have a promotional interest free period available which can be useful if you make a large purchase, as you won’t pay any interest. You will be required to pay the minimum payment each month , once the promotional period ends you’ll be charged your standard rate.
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Combined Balance and Purchase
Combined cards will usually have 0% interest introductory offers for both purchases and balance transfers. A balance transfer lets you transfer the balance from one credit card, where you may be paying interest, to another. It can also be helpful if you want to make a large purchase in order to spread the cost for a promotional period.
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Low Rate
Low rate credit cards could save you money on charges and interest. Low rate credit cards typically have a lower APR (between 6 – 15 per cent) than standard balance transfer and rewards cards which tend to have an APR of between 15 and 25 per cent.
This type of card may be useful if you don’t want to worry about promotional periods ending as it has one interest rate.
Classic
A Classic Credit Card could be right for you if you have a good credit rating but may not be eligible for a card in the main range of Bank of Scotland credit cards, where an excellent credit rating is required.
Balance Transfer
A Balance Transfer card can help reduce the amount of interest you are paying on your existing credit card debts. This type of card enables you to transfer all or part of a credit card or some store card balances onto a new credit card and you may benefit from a 0% introductory offer. When the introductory period has ended, any balance remaining on your account will be charged at your standard rate of interest.
What does it mean for me?
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Your biggest commitment is to pay back what you borrow plus any interest charged and stay within your credit limit. Each month you must repay at least the minimum payment on time as shown on your statement. Please read your credit card terms and conditions carefully so you understand how your credit card works.
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Even if your card offers an interest-free period on purchases, if you don’t make the minimum payment each month you will be charged interest on your purchases. By only paying the minimum each month, you pay more interest over a longer period and it takes longer to clear your balance. Interest charges will apply on any balance transfers (outside of a promotional offer), credit card cheques or cash withdrawals made on your credit card even if you pay your balance in full.
If you miss or make a late payment, you’ll be charged a fee. To help avoid late payment fees, you can pay a fixed amount or the minimum or full amount by Direct Debit each month. It’s also important you keep within your credit limit to avoid incurring a charge. Missing a payment could also affect your credit rating which can make it difficult to obtain future credit.
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When making a lending decision, we consider a number of factors: such as credit history (i.e. maintaining credit card payments and length of time the current account is held), current level of borrowing and financial commitments.
If successful, you’ll get a credit limit and any applicable promotional rates based on your current status. At least 51% of successful applicants will receive the representative variable rate advertised. You may receive a different promotional period, rate or product offered which will be based on your individual circumstances.
Please check all the features of the credit card to ensure they still meet your requirements as these may differ from the card you originally applied for.
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Bank of Scotland Secure is a free service that gives you extra protection when you use your credit or debit card to shop online.
If you’ve bought something using your credit card, the credit card issuer and the merchant may be equally liable for compensating you if things go wrong.