New research from M&S; suggests that many consumers who have switched their existing credit card balances onto a zero per cent deal are worse off than they would have been had they left the debt where it was, due to switching fees and additional costs.

Eddie Nott, deputy chief executive of M&S; Money, said comparing deals for all of their benefits and drawbacks was essential.

“You would like to think that nothing could be cheaper than zero per cent interest,” he said. “However, the spread of credit card balance transfer fees has in some cases wiped out much of the benefit of switching.

“Fees of three per cent are already being charged [and] should these increase further then the vast majority of zero per cent balance transfer deals will become largely worthless.”

Analysts warn that comparing deals can be more difficult than it seems however, because balance transfer fees are a one-off payment calculated on the total owing, whereas interest rates are annual fees that are added month-by-month.

To read more about zero per cent credit card deals, click here.

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