What Can You Get From Low Rate & Low Fee Cards?

Co-author: James Slack

Are you searching for a new credit card, but want to keep the costs down? Find out what rates and features are on offer for low rate and low fee credit cards on Canstar’s database.

Canstar has researched and rated 38 credit cards available in New Zealand. We’ve scoured the market to find the best rates and features on offer as of November 2018 for low rate and low fee credit cards.

Who needs a low rate credit card?

You might be in need of a low rate credit card if these sound like your spending habits:

  • Your credit card is used for much of your everyday spending, or you regularly make large purchases using it
  • It’s not uncommon for you not to repay the full closing balance on your statement each month
  • You sometimes only make the minimum monthly repayments.

redundancy insurance may be your saviour

Benefits of a low rate credit card

  • If you do end up paying interest on your purchases, you’ll pay less due to the lower rate
  • Some low rate cards also have a low annual fee or no annual fee.

Drawbacks of a low rate credit card

  • It’s usually hard to find a low rate card that offers a rewards program or any similar perks
  • Some supposedly “low rate” cards have an interest rate that is still quite high, and the card may come with high annual fees as an additional cost.

Compare Credit Cards

Who needs a low fee credit card?

Do you only use your credit card for the occasional large purchase or for shopping online? Are rewards schemes and frequent flyer points not a priority for you? You might consider signing up for a low fee credit card if:

  • You generally pay your balance in full each month, only occasionally taking more than one month to pay off a large purchase
  • Your credit card sits unused much of the time so you don’t want large ongoing fees
  • You might benefit from free extended warranty insurance that comes on some low-cost premium cards.

Benefits of a Low Fee credit card

  • Low fee cards charge a low annual fee or no annual fee, which can save you money
  • Because they’re (usually) a no-frills option, low fee cards are good if you need to access credit occasionally or in case of financial emergencies
  • A few low fee cards come with the perks you’d associate with a full-fee card, such as complimentary travel insurance and a rewards program.

Drawbacks of a Low Fee card

  • Many low fee cards compensate for the lower annual fee by having higher interest rates attached
  • Low fee cards are generally a no-frills option, so if you’re after a rewards program, these cards probably aren’t for you
  • The low annual fee doesn’t always stay that low. Some low fee cards have a promotional period for their low fee and revert to being a full-fee card after the promotional period ends. Always read the PDS and key facts sheet before buying a credit card.

Want more finance tips?

Save money by researching home loan rates
Sign up for free to receive more news and guides, straight to your inbox.

 

By subscribing you agree to the Canstar Privacy Policy.

What rates are on offer for credit cards?

The following interest rates are available for personal, non-rewards credit cards on the Canstar database:

Rate Type Interest Rate Annual Fee
Minimum 12.69% p.a. $0/year
Average 16.05% p.a. $35.50/year
Maximum 25.99% p.a. $80/year
Source: Canstar. Rates current as at 13 November 2018.

If you’re in the market for a low fee or low rate credit card, start your search using Canstar’s online credit card comparison pages:

Compare Credit Cards

Want more finance tips?

Save money by researching home loan rates
Sign up for free to receive more news and guides, straight to your inbox.

 

By subscribing you agree to the Canstar Privacy Policy.

Share this article