Credit card balance transfer fees are on the increase.

The average charge has risen by 0.5 per cent to 2.67 per cent in the past year, according to MoneyExpert.com.

Last September, the typical fee was 2.1 per cent, but the desire to recoup profits lost following the Office of Fair Trading’s order to cap penalty fees at £12 has prompted a slew of rises.

And around 90 cards now charge a flat transfer fee of 3 per cent.

That means someone shifting a £5,000 debt could pay £150 for the privilege.

You don’t have to fork out to move your debt to a cheaper card though.

True, you won’t find any lenders who don’t charge a fee offering 12 months interest-free on a transferred balance.

But you will find five and six-month deals – providers include Norwich and Peterborough Building Society, Northern Bank and Ulster Bank.

If you don’t think you can clear your balance that quickly, several others – including Sainsbury’s Bank, Northern Rock, Yorkshire Building Society and Mothercare – charge less than 6 per cent for the life of the transferred balance.

If you really put your mind to clearing your debt, you could find that works out cheaper than paying a transfer fee.

This entry was posted on Tuesday, September 11th, 2007 at 6:57 pm and is filed under UK Personal Finance, Credit Cards. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.