With card providers’ profits suffering at the hands of rate tarts and rising bad debts, consumers will find the long-term 0% balance deals free from fees becoming few and far between as providers look for alternative means to recoup their losses. Lisa Taylor, analyst from moneyfacts.co.uk comments on the competitiveness of the growing trend for providers to issue lifetime balance transfer deals.
“Lenders are struggling with the aftermath of offering the very attractive 0% deals which were used to increase their market share in an extremely competitive market. The nature of the card market has resulted in their actions having a negative impact on their own profits.
“This combined with the rising bad debts, as consumers struggle to repay their balances in the ‘live for today culture’ sees providers resorting to alternative methods to recoup their losses. Examples seen over the past few months include, adding fees to balance transfer deals, uncapping balance transfer fees, withdrawing incentives and shortening introductory rates.
“However, this has lead to the birth of lifetime balance transfer deals, providing a competitive...
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