What Is Credit Card Balance Transfer and How Does It Work?

You’re sitting at your kitchen table, sorting through your mail and dreading the sight of your next credit card bill. The high-interest rates have been eating away at your budget, but then, you remember hearing about credit card balance transfers. You realise this might be the solution to your problems.

Transferring your outstanding balance from one credit card to another is known as a credit card balance transfer. This is done to save on high-interest rates, as balance transfer credit cards often come with promotional offers at lower interest rates, or even 0% interest for a specified period. Doing this helps individuals pay off their credit card debt quickly, with lesser interest. Many renowned financial institutions in India offer credit card balance transfers that you can take advantage of.

Read on further to understand how it works, its features and its benefits.

What is Credit Card Balance Transfer

When you transfer your outstanding credit card balance to another, that is referred to as a credit card balance transfer. This is done to take advantage of lower interest rates or promotional offers. Balance transfer credit cards often come with a 0% interest rate for a specified period of time, which can provide significant savings on interest charges.

How Credit Card Balance Transfer Works

The process of credit card balance transfer is easy. Just follow these steps and you will be good to go.

1. Eligibility: If you have a good credit history with respect to your payment history, transaction patterns and spending habits, you become eligible for a transfer from time to time. However, you need to remember that only a few customers are eligible for this at the same financial institution.

2. Modes of Fund Transfer: The disbursement of funds is generally done through the National Electronic Fund Transfer (NEFT) or a Demand Draft to the customer’s other bank credit card. You need to mention the details of the bank’s name, the customer’s name as per another bank, and the credit card details of the other bank.

3. Applying for a credit card balance transfer: You can reach out to your financial institution to guide you through the process.

Steps To Do Credit Card Balance Transfer Through OneCard Credit Card

With OneCard, you can do a credit card balance transfer through a hassle-free process. All Indian residents can avail this facility. With the following steps, you can easily initiate a credit card balance transfer:

A cardholder can avail of this facility in As-Is form, that is, ‘in the existing circumstances’ with respect to the outstanding balance and pending EMIs (if any) with the beneficiary bank.

Once you reach out to us and express your concern for the same, you need to fill in the basic information like the balance transfer account name and the credit card details.

Once that is done, the balance transfer will be done via NEFT to your other bank account or Smart Collect Account (as provided by the cardholder) and will be subject to successful processing at the beneficiary bank.

The balance transfer amount via NEFT will be directly transferred to your other credit card within 48 to 72 hours from the day you raise the request.

However, please note that this feature is available only with select issuing banks. Please go through the following links to learn more about the balance transfer processes available with OneCard.

BOB Financial Solutions Balance Transfer

Federal Bank Balance Transfer

South Indian Bank Balance Transfer

Additional Read:- Introducing OneCash - Get Cash in 30 Seconds

Features and Benefits of Credit Card Balance Transfer

Credit card balance transfer helps you to potentially save money on interest. Below are the key features of OneCard’s credit card balance transfer:

1. Low or zero interest rate: This helps to reduce your pay balance and save money.

2. Transfer Fee: A fee might be charged when you initiate a request for the same. This is generally the percentage of the amount you want to transfer.

3. Credit Limit: The credit limit on the new card may place a cap on how much you can transfer. Moreover, transferring balances from the same bank or issuer might not be possible.

The benefits of OneCard’s credit card balance transfer are:

1. Lower interest rates that are friendly to your pockets.

2. Helps consolidate debt, simplifying your life.

3. Improves your credit scores, reducing your credit utilisation.

4. Rewards that make the process fun.

Fee and Charges Related to Credit Card Balance Transfer

The processing fee for credit card balance transfers ranges between 1-3%. Apart from this, the rate of interest can be 0% for the initial few months and then from 0.75%.

Additional Read:- Keep Track And Manage Your Expenses With Onecard App

Key Points to Remember While Using Credit Card Balance Transfer

While doing a credit card balance transfer, there are certain factors you need to consider. These include:

• Go through the terms and conditions carefully to avoid any confusion.

• Calculate the cost of transferring, including the processing fee or flat fee, if applicable.

• Ensure that your new card allows you to make minimum payments. Also check that the introductory interest does not act as a financial strain.

• Do not use your older credit card for purchases as this can increase your overall debt.

• Ensure you make timely payments with your new credit card to maintain a healthy credit score.

Conclusion

A credit card balance transfer is an easy way to consolidate your debt and save money. With OneCard , the process is simple and easy with no hidden costs. With us, you get access to features, such as:

• Powerful mobile app that lets you control your card as you like.

• 5x rewards on the top two spending categories.

• OneCard EMI, allows you to shop in full and pay in parts.

• With MyFamily, share your credit limit with your loved ones.