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If you need to borrow money, two commonly used options are 0% purchase credit cards and personal loans. Both let you spread the cost of a purchase over time, but they work differently.

This article explains how each works, what to watch out for, and how their costs and features compare. It does not constitute financial advice; if you are unsure what is right for your circumstances, consider seeking independent advice.

Always make sure you can afford repayments.

0% purchase credit cards

A 0% purchase credit card charges no interest on new spending for a set promotional period. Based on Moneyfacts data from 1 September 2026, the longest 0% purchase periods were up to 26 months. This reflects cards listed by Moneyfacts and may not cover the whole market. When the 0% period ends, any remaining balance is charged at the card's standard purchase rate. For context, the Bank of England's average quoted credit card interest rate was 24.71% in August 2026.

Key things to be aware of:

The promotional period — the interest-free period usually runs from the date the account opens, not from the date of the first purchase. And the actual length offered may be shorter than the headline figure depending on individual credit profile (e.g. more risky credit profiles might be offered a shorter 0% period). Some cards offer a guaranteed promotional period to all accepted applicants; others advertise an "up to" figure where the length depends on the applicant's credit history.

Minimum payments — to keep the 0% offer, at least the minimum monthly payment must be made on time each month. Missing a payment or exceeding the credit limit could result in losing the promotional rate and being charged interest from that point.

Credit limits — the credit limit offered is determined by the lender based on individual circumstances and may not be known until after application. It may not be sufficient for very large purchases.

Cash withdrawals — withdrawing cash on a 0% purchase card is generally not included in the 0% offer. Cash advances typically attract interest immediately at a higher rate. A separate 0% money transfer card, which allows funds to be moved to a bank account, may be an option for those who need cash, though a transfer fee, often a few per cent of the amount, usually applies.

Credit checks — applying for a credit card results in a hard search on your credit file. Using a soft-search eligibility checker before applying allows you to see your likelihood of acceptance without affecting your credit score.

Section 75 protection — purchases between £100 and £30,000 made on a credit card are protected under Section 75 of the Consumer Credit Act, meaning the card provider is jointly liable with the retailer if something goes wrong with the purchase. This protection does not apply to debit cards or cash.

Personal loans

A personal loan provides a fixed lump sum, repaid in fixed monthly instalments over an agreed term, with interest charged on the amount borrowed throughout.

Based on Which?'s personal loan tables checked on 1 October 2026, the lowest representative APR was 5.9% for £10,000 or £15,000 over five years, and 6.9% for £5,000 over three years. This reflects lenders listed there and may not cover the whole market. Rates are often higher on smaller amounts, and the rate you're offered depends on the lender's assessment of you.

Key things to be aware of:

Fixed repayments — unlike a credit card, a personal loan has fixed monthly repayments from the outset, which can make budgeting more straightforward.

Representative APR — the advertised rate is a representative APR, meaning it must be offered to at least 51% of successful applicants. The rate actually offered may be higher depending on individual credit profile and circumstances.

Loan amount and rate tiers — many lenders offer lower rates on amounts from around £7,500. This means the total interest cost on a slightly larger loan may in some cases be lower than on a smaller one, but this should be evaluated carefully against what is actually needed, and borrowing more than necessary purely to access a lower rate tier carries its own risks.

Early repayment — most personal loans allow overpayments, but if you repay more than £8,000 early in any 12 months, the lender can charge compensation of up to 1% of the amount repaid early (0.5% if less than a year of the loan is left).

Credit checks — as with credit cards, a hard search is carried out on application. Soft-search eligibility checkers are widely available from comparison sites. Eligibility and acceptance are decided by each lender and depend on its own criteria and checks. Checking your eligibility does not guarantee that you'll be accepted.

How the costs compare

• Interest: if the balance is cleared within the 0% period, a 0% purchase card charges no interest. A personal loan charges interest from the start.

• After the offer: any balance left on the card when the 0% period ends is charged at the card's standard rate.

• Amount: card limits are set by the lender and may be lower than the amount needed. Personal loans are often available for larger amounts.

• Repayments: a personal loan has fixed monthly repayments and a known total cost. Card minimum payments vary with the balance, and paying only the minimum may not clear the balance within the 0% period.

• Cash: personal loans pay cash into your account. Cash withdrawals on a card are usually charged interest straight away.

Rates and terms checked in October 2026. Both credit cards and personal loans are subject to eligibility and individual credit assessment. This article is for general information only and does not constitute financial advice. If you are struggling with debt, free impartial advice is available from StepChange, National Debtline and Citizens Advice.