despite credit card providers writing off up to 10 per cent of outstanding balances as bad debts, there is still a huge choice of credit card deals out there, offering a confusing array of introductory deals with numerous interest rate and fee combinations.
That's why it was a refreshing change to see the launch of the new Clarity credit card from Halifax last week. It's simply a good value, no nonsense product which stands out from the majority of the market.
There are no confusing interest-free introductory offers for purchases or balance transfers; instead, Halifax is aiming for a longer-term relationship with customers by offering straightforward value. What is particularly good is that there are no cash withdrawal or foreign loading fees for those who like to use their credit card overseas. Typically, a £100 cash withdrawal abroad can cost you almost an extra £6, by the time you take into account a 3 per cent withdrawal fee plus a foreign loading fee of typically between 2.75 per cent and 2.99 per cent.
At 12.9 per cent, the Clarity card's APR for purchases is well below the market average of 18.4 per cent, and the cash rate of 12.9 per cent is less than half that charged by many high-street rivals. While 12.9 per cent is the typical rate, bear in mind that some people with a less-than-perfect credit record may be offered the card at a slightly higher rate of 17.9 per cent or 21.9 per cent APR.
If you are someone who doesn't clear their balance every month, then one of the many cards offering a 0 per cent introductory deal on purchases or balance transfers may be a more cost-effective option. Halifax's Clarity card is a back-to-basics product and likely to prove a big hit with holidaymakers in the coming months, providing the opportunity to withdraw cash overseas without having to shell out a small fortune in costs.
It's also good to see Halifax customers being given the opportunity to earn a further £5 bonus per month, simply by spending a minimum of £300 per month on their card.
If you take out the current account and the credit card, you can potentially earn £120 per year in return for your loyalty, a strategy that could well pay dividends for bank and customer alike