Halifax, a part of Lloyds Banking Group, has launched a new fee-free credit card that allows cardholders to pay off their debt for free for up to 16 months.
Called the Halifax 16 Month Balance Transfer Card, the new credit card provides a 0% interest-free promotion on new purchases for the first six months in a move to cut down the costs of transferring debt and to attract new customers.
The 0% fee will be applicable only to balance transfers that happen within the first 90 days of opening the account with the bank. However, customer will be charged 3% to transfers made beyond 90 days of account opening.
According to Halifax, a balance transfer of £2,000 from a credit card with an 18.9% interest rate will save £435.99 across 16 months for the customer by moving to this new card.
The bank will provide majority of its accepted customers the 0% interest for 16 months, while for consumers who are not accepted on the 16 month deal but do qualify for the credit card, will be offered 0% interest on a much shorter time period of just nine months.
Following the nine months period, the interest will increase to a rate of either 21.9% or 25.9% depending on the personal circumstances of the customer.
A representative of Halifax Credit Cards Jon Roberts said: "By launching this market leading balance transfer credit card, Halifax is demonstrating its continued commitment to providing extra value and choice to customers.
"The ‘Halifax 16 Month Balance Transfer Card’ is designed to provide choice to customers who are looking for one card that enables them to avoid charges when transferring balances and making new purchases. This gives them the opportunity to restructure their borrowing in a more cost-effective way."