Low interest credit cards offer a low rate of interest over a long (usually fixed) period of time. Representative APRs on low interest credit cards currently start at around 6% to 7%, though most applicants will be offered a higher rate.

Usually when credit cards offer a low or 0% interest rate this only lasts for a set promotional period. After that, the interest rate will go up to a standard rate. With low interest credit cards, the rate is usually set for the lifetime of the card.

What are the advantages of a low interest credit card?

• The rate is set for the lifetime of the card, making budgeting more straightforward

• You don’t have to keep switching cards to take advantage of various 0% deals, and can avoid paying balance transfer fees

• Low and 0% interest cards tend to carry a significantly lower annual fee than regular cards - sometimes there’s no annual fee at all

• If you usually pay off your bill in full every month, but think you might occasionally make a big purchase and need to carry over a balance, the level of interest you'll be charged will be relatively low

Low interest vs 0% purchase vs balance transfer cards: which is right for you?

These three card types solve three different problems. A low interest card gives you a modest rate that lasts, a 0% purchase card gives you a temporary window of free borrowing on new spending, and a balance transfer card moves debt you already owe onto a cheaper footing. If you're trying to work out how to decide which credit card is best for you, start with what you actually need the card to do rather than with the headline rate.

Quick decision prompts

If your borrowing is mostly new spending you can repay within a defined window, a 0% interest card may be worth comparing. If it's existing debt sitting on a higher-rate card, a balance transfer card may be worth comparing because every payment goes at the balance rather than the interest. If your use is mixed and ongoing - you clear the card most months but occasionally roll a balance over - a low interest card avoids the effort of switching cards every year or two and the fees that come with it.

A fourth option: money transfer cards

Money transfer cards let you move a sum from your credit card into your current account, often at 0% for a set period in exchange for a fee. They're worth knowing about if you need cash rather than card spending - for example to clear an overdraft - because using a low interest card at an ATM will attract cash advance charges instead. For larger amounts, a low interest loan may work out cheaper again.

What should I be aware of?

• If you have a large balance you want to pay off, a 0% balance transfer card could be of more use to you, as it will give you the opportunity to start pay off your balance, not just the interest.

• If you’re accepted for a low interest card, you may not automatically qualify for the advertised rate (often shown as 'Representative APR)'. Many lenders will assess your individual circumstances when you apply and will offer the lowest rates to those with better credit ratings. Read the paperwork carefully so you’re not caught out.

• Try to avoid using a low interest card for taking out cash. The low interest is usually only for purchases, not cash advances.

• You could also try looking for a low interest loan if you need to borrow a little more than a credit card will offer.

How much could a low interest credit card actually save you?

The saving comes from the gap between the low rate and a typical standard rate, multiplied by how long you carry the balance. Take a £2,000 purchase. On a low interest card at around 6.9% APR repaid in equal instalments over 12 months, you'd pay roughly £75 in interest. On a card at a more typical 24.9% APR, the same repayment plan costs around £270. Stretch the repayment to 24 months and the gap widens: roughly £145 of interest at the low rate against about £550 at the standard rate. The rate matters, but the length of time you owe the money matters just as much.

Why minimum payments wipe out a low rate

Paying only the minimum each month is the fastest way to lose the benefit of a low APR. Minimum payments are usually calculated as a small percentage of the outstanding balance, so they shrink as the debt does, dragging repayment out over years. A balance that would clear in two years on fixed payments can take the best part of a decade on minimums, and the total interest can end up several times higher even at a low rate. Setting a fixed monthly direct debit above the minimum is what turns a low APR into a real saving.

Low rate versus a 0% deal plus a transfer fee

A 0% balance transfer card charges no interest but usually charges a fee of a few per cent of the amount moved. On £2,000, a 3% fee is £60 up front. Compare that with the interest a low interest card would charge over the same period - around £75 across a year in the example above - and the two options can land close together. The 0% deal generally wins for larger balances or longer repayment periods; the low interest card often wins for smaller balances, or where you'd rather not reapply and transfer again when the promotional period ends.

When the saving isn't worth chasing

If your balance is small, if you'll clear it within a month or two, or if you already pay your statement in full every month, a low interest card saves you very little - you're not being charged interest in the first place. In those cases a card that offers rewards, cashback or purchase protection may be worth more to you than a low APR. A low interest card earns its keep when you genuinely expect to carry a balance from time to time.

All figures here are illustrative and rounded. Advertised rates are representative, meaning only a proportion of successful applicants need to receive them, and your own rate and credit limit will depend on the lender's assessment of your circumstances. Always check the specific terms of the card you're offered before you borrow.

How likely am I to be approved for a low interest credit card?

This will depend on your credit report and other factors lenders consider - such as your income, existing borrowing and whether the repayments are affordable. You can find out your eligibility rating for various different credit products in the section of your ClearScore account.

ClearScore is a credit broker, not a lender, and works with a range of lenders and other credit brokers rather than exclusively with one. Credit reference agencies calculate scores from information in your credit report, and lenders use their own criteria and may score applications differently, so your ClearScore score is an indication rather than a lending decision.

If your score currently sits in Let’s start climbing (0-409) or Moving on up (410-519), a low interest card may be out of reach for now, but don’t give up. You just have to play a slightly longer game - look at our 10 steps to a great credit score article for small changes you can make to improve your score.

Next step:Compare credit cards to find the right one for you.

How to improve your chances of getting the advertised low rate

Lenders tend to reserve their lowest rates for applicants who look lower-risk on paper. These steps may strengthen how you look before you apply, though the decision is always the lender's.

• Use eligibility checkers and soft searches first. A soft search indicates how likely you are to be accepted without leaving a mark others can see, though acceptance still rests on the lender's checks. You can check your eligibility rating for different credit products inside your ClearScore account (a credit broker, not a lender) before you commit to a full application.

• Space out your applications. Several hard searches in a short space of time is one of the biggest avoidable drags on a credit score - it reads as though you're urgently seeking credit. If you're turned down, wait a few months before trying again rather than working through a list of lenders.

• Get on the electoral roll and check your address history. Registering to vote at your current address is one of the quickest wins available, because it helps lenders confirm you are who you say you are. Make sure the address history on your report is complete and consistent across your accounts.

• Bring your credit utilisation down. Utilisation is the share of your available credit you're actually using. Sitting near your limits suggests strain; paying balances down below roughly 30% of your limits before you apply presents a healthier picture.

• Check your report for errors, defaults and old linked accounts. Incorrect defaults, accounts you've closed that still show as open, or a financial association with an ex-partner can all pull your rate up. You can dispute inaccurate entries with the lender or the credit reference agency.

• Keep long-standing accounts open where it makes sense. On whether it's better to cancel unused credit cards or keep them, closing an old card shortens your average account age and cuts your total available credit, which pushes utilisation up. Unless the card carries a fee or tempts you into spending, leaving it open and using it occasionally usually helps more than closing it.

• Give it time before reapplying. There's no way to transform a credit score in 30 days. Most improvements come from several months of on-time payments and falling balances, so plan applications around that timeline rather than against it.

If you're offered a higher rate than advertised

Lenders only have to give the representative APR to a proportion of accepted applicants, so a higher offer is common rather than a mistake. You're under no obligation to accept it. Check the total cost against alternatives, ask the lender whether a lower rate is available on a smaller limit, or spend a few months strengthening your report and apply again. Small changes can add up - our guide to improving your score sets out where to start.

Low interest credit cards: frequently asked questions

What counts as a 'low' APR on a credit card?

There's no official threshold, but anything meaningfully below the typical market rate is generally treated as low. With standard purchase rates commonly in the mid-20s, a card advertising a rate in the high single figures to mid-teens sits in low interest territory. The lowest rates tend to go to applicants with strong credit histories.

What is the 2/3/4 rule for credit cards and does it apply in the UK?

The 2/3/4 rule is an informal guideline associated with certain US card issuers, limiting applicants to roughly two new cards in 30 days, three in 12 months and four in 24 months. It isn't a UK rule and no British lender publishes it as policy. The underlying principle still holds, though: applying for several cards in quick succession leaves a cluster of hard searches on your report and makes approval at the best rate less likely.

Is it better to cancel an unused credit card or keep it open?

In most cases, keeping it open helps. An older account lengthens your credit history and its unused limit lowers your overall credit utilisation, both of which lenders view favourably. Close the card if it charges an annual fee you're not getting value from, if the account is dormant and poses a fraud risk, or if having the credit available encourages you to overspend.

What damages a credit score the most?

Missed and late payments do the most damage, followed by defaults, County Court Judgments and bankruptcy - all of which stay on your report for six years. Day to day, the biggest avoidable harm comes from persistently high credit utilisation and a burst of applications in a short period.

Does applying for a low interest card hurt my credit score?

A full application leaves a hard search, which can dip your score slightly for a few months. One application is rarely a problem. Several in quick succession is. Running an eligibility check first uses a soft search, which doesn't affect your score and doesn't show to other lenders.

Can I get a low interest credit card with bad credit?

It's unlikely. Low rates are priced for lower-risk borrowers, so applicants with poor or thin credit histories are usually offered credit builder cards instead - these carry high APRs but small limits, and are designed to be cleared in full each month. Several months of on-time payments and low balances can open the door to better rates later.

Does the low rate apply to balance transfers and cash withdrawals?

Usually not. The advertised low rate normally covers purchases only. Balance transfers may carry their own rate and fee, and cash withdrawals almost always attract a higher rate plus a cash advance fee, with interest charged from the day you withdraw. Check the summary box on your card agreement for the rate applied to each transaction type.

Can a lender change the interest rate on a 'lifetime' low rate card?

Yes. 'Life of card' means the rate isn't tied to a short promotional window, not that it can never change. Lenders can vary rates, but they must give you advance notice and, where the change is to your disadvantage, the option to reject it, close the account and repay the outstanding balance at the existing rate.