Top 10 Credit Cards in the UK

People need credit cards for different reasons. But the basic reason is access to credit. 

If you’re moving house, for example, you need to buy some furniture. Assume that you expect money in your account at the end of the month. But you’re moving in the first week. 

What do you?

Simple option: get a credit card and payback at the end of the month.

However, no one just walks into a credit card provider’s office and walks away with a card. You have to prove that you’re worthy of the credit card. This information is provided in your credit file.

Now, the type of card you get depends on the information your credit history provides. Usually, people who have defaulted in credit repayment are less likely to be in favour of lenders. Also, if your records show that you have been consistent with repaying cards then you’re more likely to get a competitive interest rate.

Before you choose your credit card lender, you need to learn the types of credit cards. Credit cards vary according to the value they offer. Lenders make these offers with specified terms and conditions. Even though some of them sound enticing, it’s always important to compare the underlying risks.

Types of Credit Cards

There’s an abundance of credit cards types. The choice you’ll make depends on the need you have for a credit card. 

Credit-Building Credit Cards

The first set of people who need this card are those who have no credit history. The next set is people with bad credit history.

For people with no credit history, it’s difficult to gauge how responsible you are with credit. As a result, a lender assumes that you are a risk. He just can’t tell how much risk you are.

People with bad credit history can take another chance at showing that you can be more responsible. There’s no reason for lenders to believe you but you have another chance. 

This credit card comes with higher interest rates. Plus the limit on credit is a lot lower. Using this card with discretion and making payments on time adds to your credit points. Over time, you will have a good credit history and can apply for better cards.

Credit Card: Barclaycard Forward credit card 

Suitable for first-time credit card holders and cardholders with bad credit history. This card offers a personalized credit limit that lies between £50 and £1200. The representative APR and purchase rate go as high 33.9%. However, with Barclaycard Forward credit card, you can work your way to a 3% reduction in the standard interest rate within your first year of owning the credit card.

Balance Transfer Credit Cards

Sometimes you may want to transfer your credit from an old card to a new one. A balance transfer credit card allows you to do that. The terms depend on your credit card provider.

Some lenders offer a 0% balance transfer. This allows you to move your credit without interest charged for a stipulated time. In some cases, the 0% offer comes with a 0% offer on purchases. This can help you keep track of your debt.

However, some banks charge for the transfer. The charge usually accrues to some percentage of the amount you’re transferring. You may want to be sure that the charge is not higher compared to being charged interest.

Credit Card: Virgin Money Credit Card

This credit card allows you to transfer money from other cards at no cost up to 24 months. With the introductory promotional rates, you get to enjoy a 0% interest rate on balance transfers if you transact within the first 60 days of account opening. The representative APR is stated at 21.9%. 

Student Credit Card

Before you can get a student credit card, you have to prove that you are a student. This credit card works similar to a credit-building credit card. As you use the card and repay your debt in good time, more points are accrued to your credit history.

Student credit card is attached to the current account facility of the student. It is offered primarily to students in the university.

Credit Card: AIB Student Credit Card 

Offered by former First Trust Bank, this student credit card offers holders as low as £300 credit limit. It comes with no additional cost of maintenance and a 12.9% interest rate on purchases. However, you need to have an existing account with AIB to apply. The representative APR is 12.9%. 

Purchase Cards

It often happens that you need to make big purchases over a period. But you also want to circumvent the interest charges for this time. Purchase cards with 0% interest offer can help you achieve this.

Usually, lenders offer a 0% interest for a specified period. It may run from one month to 36 months. Albeit, you have to pay back your credit before the interest time expires. Otherwise, the bank charges interest on the balance you have left.

Credit Card: TSB Platinum Purchase Credit Card

TSB offers 0% interest rate on balance transfer and purchases up to 20 months. The introductory deal allows you to enjoy this offer if you make a transaction within the first 90 days from the day your lender opens your account. The representative APR is 19.9%. 

Money Transfer Credit Cards

Suppose you have made some overdraft from your bank account. Or you want to take some cash loan that is not too high. A money transfer credit card comes handy.

This card can also come with an offer of 0% introductory time. This means that you won’t be charged any interest for making a transfer to your account for a specified time. So, you can pay off your debt without a lot of financial pressure.

You have to ensure you pay off whatever your debt is before the 0% interest period expires.

Credit Card: MBNA Money Transfer Credit Card

If you’re in need of immediate cash loans without having to pay interest immediately. You get a breather for transfers you make within the first 60 days for up to 24 months. There are no annual fees and representative APR is at 22.9%. 

Reward Credit Cards

A reward credit card offers you some points each time you use your card for a transaction. These points accumulate into benefits like hotel vouchers, air miles, and shopping vouchers. 

This type of credit card is usually beneficial if you have a good credit history and if you pay off your debt in time. Otherwise, the reward on them diminishes in the face of the associated interest. 

If you are a big spender, the reward on purchases will make even better sense to you. This is because the lender may specify an amount that you have to earn before you can benefit from the reward. The card may also be affiliated with a specific brand for you to enjoy the reward. 

Be sure that the reward offered by your lender outweigh the charges that come with owning the cards.

Credit Card: M&S Bank Reward Plus Credit Card

This card offers an introductory earn-point of 2000 worth £20 on all cards used within the first 90 of registration. Subsequently, you get double points on your transaction for up to 12 months with a 0% purchase interest rate that lasts up to 6 months. Representative APR is valued at 19.9%. 

Cashback Credit Cards

Cashback credit cards give you some cashback to your account when you make spendings from them. They typically work like reward cards, except that you earn cash in return for your loyalty. They are suitable for you if you are consistent with paying back your debt on time and if you prefer cash rewards against points rewards.

The earn-rate on a cashback credit card often depends on how much you are spending and where you are spending. If the card is affiliated to a brand, you usually stand more chances of earning back when you spend with the associated brand. Plus the reward will usually be higher.

Be sure this credit card benefits your spending habit before you apply for it.

Credit Card: American Express Platinum Cashback Credit Card

This card offers you up to 5% earn-points on transactions up to £125 when you use your card within the first 6 months. You can enjoy other benefits from the lender’s partners plus cashback on subsequent transactions with your card. The representative APR is stated as 27.3%. 

No Foreign Transaction Fee Credit Card

If you travel a lot or tend to buy products and services from international retailers, you may need a card that charges you little or nothing on your transactions. With this card, your transaction will be converted to the local currency at the rate offered by the card network provider. Some no transaction fee credit cards may still charge you some interest. Plus, they may not be of use if you’re shopping or traveling beyond Europe. So, check to be sure what you are getting.

You can have a backup card which you use in the UK while reserving your travel card exclusively for foreign transactions. The transactions on your card may involve a charge when you make cash withdrawals outside the UK. Ensure that you are aware of all charges that come with owning this card.

Credit Card: Royal Bank of Scotland Credit Card 

If you’re huge on spending overseas, get a RBS credit card. It converts your spending to the currency of choice at mastercard rates without any extra charges. You also don’t need to pay any annual charges. The representative APR is placed at 9.9%. 

Frequent Flier Credit Card

For people that fly often, a card that gives you points reward on your travels will be a huge add. For every transaction you make with the card, you can get back an air mile or frequent flier point when you can transfer to your preferred loyalty programme. There may be some added charges, that annual fee, to running the credit card. But in some cases, your points reward may outweigh the charges.

Check if your lender accrues the points reward to a particular airline or if you can redeem the points with any airline. There may be some introductory promotion that offers you some accumulated points at the initial stage. As always, the benefits have to be more than the charges for it to be worth your time.

Credit Card: British Airways American Express Credit Card

If you’re always flying, get a British Airways Amex card. It comes with an initial credit bonus of 5000 for Avios loyalty scheme. You activate this bonus when you make transactions up to £1,000. You can also enjoy perks like automatic enrollment into British Airways Executive Club. The representative APR is 22.2%. 

All-rounder Credit Card

Have you thought of how you may be a bit of everyone listed here? You are a traveller who spends a lot in foreign currency. Plus, you make huge expenses when you’re at home and need some sort of “interest breather”. This card offers you 0% on balance transfer and purchases. Plus, it offers you reward points on your spendings and no transaction fee on foreign spendings.

The card lender may offer this card to you with reference to a specified minimum earning. Plus, none of the benefits offered may be at its best. It’s not very convenient to use this card if you have a specific need you’re looking to meet. For example, if you need to transfer credit balance to a new card. The deal period on an all-round credit card may not be as long as if you’re using a balance transfer credit card.

If you have specific needs to meet, it’s better you opt for the specific credit card.

Credit Card: Virgin All Round Credit Card

Virgin All round credit card offers 0% interest on balance transfers, money transfer, and purchases. The time for balancce transfer plan goes up to 18 months, 12 months for money transfer, and for purchases is 15 months. Introductory plans can be enjoyed within 60 days of opening an account. APR is placed at 21.9%. 

5 Frequently Asked Questions

Here are answers to some frequently asked questions on credit cards.

What is the best credit card for me?

The best credit card for you will depend on your situation and needs. The situation includes credit history and how much you earn, amongst other things. You also need to decide what you want your credit card for. If you want the card for more than one reason, make a list and place the need in the hierarchy. Choose your card based on the most important reason. 

Also, compare credit cards according to the rates they offer. The reward a lender is making should not outweigh the benefits for you. If you need cash short term, then a short term loan might be a better option for you than a credit card.

Can I change my mind after I’ve applied for a credit card?

Yes. It’s possible to change your mind after you’ve applied for a card and received it. But, bear in mind that you may have accumulated some credit during the period which you will need to clear within 30 days.

Lenders require you to cancel within 14 days from the time you receive the card if you have a change of mind.

How long do I have to wait before I receive my credit card?

After the application process, how long you have to wait depends on your lender. Often, it ranges within 1 to 2 weeks. You’ll also need to activate your card when you receive it. Activating your credit card helps to protect you from fraud when using it.

If you need fast cash and can’t wait for a credit card to be approved then you can take a look at what quick loans have to offer you. In the UK you can get fast cash loans of £100 £200 and £500 without any problems.

What if I have a bad credit history?

There are cards reserved for people with bad credit history. It’ll help you build your credit score again. If you apply and get issued one, you need to be responsible with your spending and payments. Over time, you can demonstrate that you can be trusted with credit card facilities again.

I applied for a credit card but I was declined. What do I do?

The first thing you want to consider is reaching out to your intended lender to find out why you were declined. Be sure it wasn’t an oversight. But avoid multiple credit card applications. They put a dent on your credit history by making you appear desperate. This will also make lenders unduly cautious of you. You still have options, you can go for bad credit loans that do not require a guarantor.