How can I transfer money to a current account at 0%?

I want to do a balance transfer to a current account so I can pay back an overdraft without interest. Can I do this with a normal 0% balance transfer deal?

Some 0% balance transfer deals do actually allow you to move the money direct to your current account - although it's important to get the right card as not many do.

These deals are normally called 'money transfers' on credit card terms, however they may also be referred to as 'super balance transfers'.

Here are 3 of the current top deals offering 0% money transfers, but you can also see the full comparison of super balance transfer credit cards here.

0% transfer to a current account deals

For money transfers:	0% Period	Fee	Additional
Virgin Money	0% for 20 mths	4%	-	Apply » More »
Representative Example: 16.8% p.a. variable on purchases. This is equivalent to 16.8% APR representative variable based on a credit limit of £1,200. Virgin Money, Discovery House, Whiting Road, Norwich, NR4 6EJ.
Virgin Money All Round	0% for 16 mths	4%	-	Apply » More »
Representative Example: 15.8% p.a. variable on purchases. This is equivalent to 15.8% APR representative variable based on a credit limit of £1,200. Virgin Money, Discovery House, Whiting Road, Norwich, NR4 6EJ.
The AA Balance Transfer	0% for 16 mths	4%	-	Apply » More »
Representative Example: 17.9% p.a. variable on purchases. This is equivalent to 17.9% APR representative variable based on a credit limit of £1,200. MBNA Europe Bank Limited, Stansfield House, Chester Business Park, Chester, CH4 9QQ.

How balance transfers to a current account work

Money transfers work in very much the same way as normal balance transfers, except that your current account gets credited with the amount you borrow.

This offers some flexibility, as unlike standard balance transfers which are limited to only repaying other card debt, the money can be used as you need it.

Being able to borrow, effectively cash, at 0% can offer a way to repay overdraft debt or small loans.

The actual transfer process will be very much the same - although it is important to ensure you 'transfer' the money under the correct deal.

If using telephone banking simply ask for the '0% money transfer' and confirm all the details before proceeding, similarly online banking should have it specified as a seperate option to normal balance transfers.

What to be aware of

Money transfers are sometimes charged a higher fee than those to other cards.

MBNA charges around an extra 1% on their standard fees, while they tend to have the longest 0% periods - the fees are more expensive.

If the money is needed for new purchases 0% purchase credit cards may be a better option.

Stoozing

Another reason to balance transfer to a current account is in order to profit from the discrepancy between interest paid by your bank and the 0% interest charged by the credit card.

This is known as "stoozing" and basically offers a chance to borrow money at 0% and let the transferred balance sit in savings and earn interest. (Banks operate this way with each other all the time!)

Again though, with interest rates so low at the moment, stoozing may work out better on a 0% purchases deal where you save your normal spending, as the transfer fee is likely to be more than most of the interest earned.

Other points to remember and consider

Not all 0% balance transfer credit cards let you move money to your current account - check with the lender or look at the terms & conditions first.

Other credit cards may allow you to do it but fees and interest can apply that will make it unrealistic.

This super balance transfer credit cards comparison table lists those cards that do allow it, alongside any difference in fee as well.

In considering a transfer, you need to weigh up transfer fees - when deciding if it is financially worthwhile.

There is some competition in the market at the moment for reducing fees, but this has yet to knock into money transfers, which are still typically around 3% to 4% of the amount you move.

Keeping up minimum monthly payments and not defaulting on the account such as exceeding the credit limit or being late with a payment is important. Not doing so will likely see the 0% rate withdrawn.

Additionally, remember to budget repayments and try to ensure the balance is repaid before the end of the 0% period. Any balance outstanding after this point will become subject to standard interest rates, which can be high on these deals - often more than for normal balance transfers, > ~20% p.a. variable.

Summing up

If you can access the few credit cards allowing 0% balance transfers to current accounts, you may find that you reduce your overall debt repayments (clearing overdrafts, etc) or even make a profit (stoozing).

However, it's important to get the right credit card and stick to the terms and conditions sensibly.

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