Number of interest-free credit card deals rises in March

Customers now have more options and longer interest-free terms to choose from.

Springtime doesn’t have to be just about cleaning out your home, it can also be a good time to revise finances and consolidate debts.

It therefore may come as welcome news that the number of interest-free credit card offers edged higher during the first quarter of 2025. This is according to the latest Moneyfacts UK Unsecured Lending Trends Treasury Report, which analyses the personal finance market.

It found that the number of interest-free balance transfer offers increased from 63 to 65 between December 2024 and March 2025, marking the highest this figure has been in 19 months. Meanwhile, the amount of interest-free purchase credit card deals available on the market held at 62 during this period, though this is still at its highest count since July 2023.

These figures also represent a year-on-year increase in the number of both balance transfer and purchase credit cards where only 61 and 58 products respectively were available at the beginning of March 2024.

Longer 0% interest terms

Alongside having a greater selection of products to choose from, customers can also benefit from longer interest-free terms.

For instance, the average interest-free term for a purchase credit card rose to 267 days in March, up from 262 days from the previous quarter and 255 days a year prior. Likewise, balance transfer cards also saw an increase for the average interest-free period, rising from 512 in December to 529 in March – marking an 18-month high.

“The rise in terms and options is positive but consumers will need to carefully compare the upfront costs when moving card debts, particularly as some of the lengthiest interest-free terms charge fees of over 3%,” noted Rachel Springall, Finance Expert at Moneyfactscompare.co.uk.

Borrowing costs on the rise

Indeed, costs should be at the forefront of customers’ minds when comparing different credit options.

The average purchase Annual Percentage Rate (APR) for credit cards has been on a steady incline in recent years, rising to a record high of 35.6% in August 2024.

However, as of March, this figure sits lower at 35.4%, despite having risen since the previous quarter from 35.3%, and has also marginally decreased compared to a month ago.

It’s a similar story with average balance transfer fees, which climbed from 2.44% to 2.47% in the same quarter, while still being lower than the 2.48% recorded in February.

Unsecured loan offers

Borrowers looking to consolidate their debts could consider an unsecured personal loan.

Those looking to borrow £5,000 over three years, or larger sums of £7,500 and £10,000 over five years, will find the average APR has fallen across the board to 11.1%, 8.4% and 8.3% respectively over the last quarter. These rates were previously at 11.2%, 8.5% and 8.4% respectively as of December 2024.

“However, those looking to borrow a small sum of £3,000 over three years may be disappointed to see the average rate has risen over the past quarter, now standing at its highest point in almost six months,” remarked Springall.

This figure had been holding at 16.6% in December but crept up to 16.8% in March.

Nevertheless, whether you’re considering a loan or a credit card, it’s important to weigh up any additional costs or terms before committing, and to not to take on more debt than you can afford.