Annual Fee
Annual Fee is an amount that the credit card company may charge for you to have the card. It is very common
nowadays to have no annual fee, so we don't show that in our comparison chart. If it applies, we will tell you
about it on the credit cards pages for each card.
Account Number
This is the main identifying characteristic of a credit card. It is usually a 16-digit number embossed on the
front of the credit card in 4 batches of 4. Together with an expiry date, the name on the card and increasingly
frequently the 3 digit verification code on the rear of the card these identify the cardholder exactly.
APR - Annual Percentage Rate
APR stands for Annual Percentage Rate and it will always be quoted to you when you are looking to apply
for a credit card online. It's the percentage rate which your borrowings will increase over a full year including
all charges including fees. If you see 'typical' APR, then the company has to ensure that this rate applies to
more than 66% of its customers.
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Balance Transfers
Balance transfers are when you swap a debt from one place to another - different rates usually apply to the
main card APR rate and often with an
introductory low interest period, and may also apply for the life of the balance. Check the product information
for details. The period of the balance transfer can be seen on the main comparison chart on our home page
but you can also check the creditcard company pages themselves to see available offers. Some credit cards have offered
zero apr balance transfer deals for up to a year.
Balance Transfer Fee
Balance Transfers Fees are incurred when you make a balance transfer. They are listed on our comparison table
as they do vary from card to card and provider to provider. It is typically a percentage value of the amount
transferred to the card balance.
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Cashback Cards
Cashback cards are occasionally available where the company will give you back a percentage of the money you
spend on the card, typically annually or every six months. Although it is a small percentage, sometimes there
are introductory deals or arrangements where you can get a higher percentage if you spend above a certain
threshold. You need to check the provider information on the card page, and obviously with the credit card issuer
as well. This information should be made clear. These are not the same as reward cards which have different
benefits for usage.
Credit Card Cheques
These are often sent by credit card companies to holders of cards. They are simply another way to spend money on your
credit card and may result in interest being charged earlier than if you used the card itself, and may be charged at
a higher rate (eg that applicable for cash advances).
Credit Limit
This amount is the most that an issuing company will allow you to borrow, to have outstanding on your card.
They are initially set when your card is issued, but can vary according to how your credit history develops and
your other personal circumstances.
CVV2
Also known as the Cardholder Verification Value
CVV2 are three numbers help ensure that the physical card is in the cardholder’s possession while shopping online
or by phone, helping to prevent unauthorized or fraudulent use. (from Visa)
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Donation Cards
Donation cards - or charity cards are those which give a certain percentage of your expenditure to a nominated
charity or charities. The cards are usually themed to that particular aim.
Debit Cards
Debit cards are not credit cards, they are usually directly linked with a bank account and your money is taken immediately.
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Extra card
Extra cards are often available for people sharing the same residential address eg husband and wife.
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Gold Card
Gold cards are usually available for people earning a reasonable salary and will typically come with slightly
higher credit limits. This varies from provider to provider, so check with the issuing company for their advice
when you compare credit cards.
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Interest Free Period
With most credit cards, you can enjoy up to 59 days interest-free credit. However, this varies according to the billing
date and the date of the statement issued, together with the day when you pay the bill.
So if buy something just after your monthly statement, you may have almost two months before you have to pay the bill.
For some transactions such as cash withdrawals you may be paying interest immediately from the time of the advance.
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Life Of Balance
Sometimes special interest rate arrangements are on offer for the "Life Of Balance" which means that
the specific amount transferred 'the balance' is at a special rate, and interest is charged on that amount
for as long as you hold it. This will often be a low rate (and not a zero rate). Take a look at the terms
and conditions for the specific card with an offer like this.
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Mastercard
This is one of the biggest credit card organisations. Together with VISA they operate an international networks which
joins together merchants and retailers with the card issuing banks or companies.
Minimum payment
This is the amount that the card issuer asks the cardholder to pay each month. It might be 2% of the balance, or £5,
or something like that. It is independent of the interest rate on the card. You should check the agreement with
the card issuer to ensure you understand your minimum payment threshold.
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Pin (Personal Identification Number)
Usually a 4 digit number, this kind-of password allows you to verify the card is yours. 'Chip and pin' is increasingly
taking over from the signature identity verification. The 4 digit PIN must be memorised by the cardholder and kept secret.
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Reference Number
For each transaction a reference number is issued. This enables tracking of the transaction to take place and you
may see it on your credit card statement. If you have any doubts about a particular transaction you can quote this
number to your card issuer and follow it up.
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Statement
Virtually all credit card companies issue monthly statements. Many also offer the statement of account online with
appropriate passwords and verified login information.
Store Card
Usually tied to a particular retailer, a store card can be a credit card but is typically tied to that retailer
and provides discounts or loyalty points or other rewards at that retailer. Check the terms and conditions of
any store card carefully to see what the advantages and disadvantages may be.
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Transaction
The key event for credit card holders is the transaction. This is the agreement between
two or more parties that establishes a legal obligation, and is usually shown on a credit
card statement for each purchase or charge to the card holder.
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VISA
Along with Mastercard, VISA are probably the biggest card organisation in the world with their familiar yellow and
blue logo. They operate international networks joining banks and merchants together with people shopping for real goods in the real
world! It stands for Visa International Service Association (a recursive acronym!).
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