New service takes ‘gamble’ out of balance transfer card applications

Credit card customers looking to switch their debt will no longer have the gamble of not knowing whether they can transfer the full amount before they apply under a new service.

Experian said its new “credit limits” service for balance transfer cards will help people to make more informed choices – as people will be able to see whether they can transfer the full amount before they apply.

Shifting debt on to a balance transfer card can help people to keep the cost of servicing the debt down.

Experian said that people looking to switch their debt to a balance transfer card have previously had the problem of not knowing whether they will be able to transfer the amount they would like to until they complete the application.

This means that some have taken out new credit that does not cover their existing debt.

Making an application for credit leaves a mark on their credit report, regardless of whether they go on to use the card, which could impact their chances of finding credit that covers their needs.

Experian said people will not only be able to see whether they will get the credit limit they need, but also the actual rate they will get and their chances of being approved for credit before applying for a balance transfer credit card.

Vanquis is one of the first providers to guarantee people using Experian’s new comparison service that their balance transfer request will be accepted.

Amir Goshtai, managing director of Experian Marketplace, said: “Currently, applying for credit cards can be a bit of a lottery as people don’t know if they’ll get the credit limit they need…

“We continue to work with our other partners to expand the service further in the coming months.”

Consumer finance expert Martyn James said of the service: “For too long, people have been stuck with a gamble when it comes to transferring a credit card balance.

“On one hand, they want to reduce the crippling interest rates of some cards, yet often they are wary of the risk of a credit application marker on their credit report if they don’t qualify for the full balance transfer, or at all.”

He described it as “a great innovation and with January on the horizon, a time when many of us tackle our finances and debts”.