The interest-free periods on some UK credit cards are set to get longer in the coming months. Results from the Bank of England’s Credit Conditions Survey suggest that the upward trajectory of recent months is set to continue, just in time for the Christmas shopping rush. This could see the interest-free period on the top 0% balance transfer card exceed the three-year mark and the best 0% purchase card push closer to two-and-a-half years.
Many consumers use interest-free purchase and balance transfer credit cards to spread the cost of their spending or manage their debt. Longer 0% periods mean consumers will not need to pay interest on certain credit card balances for even longer than the current top providers are offering.
While a considerable number of shoppers and borrowers will be pleased to see interest-free borrowing periods getting longer, it is worth noting that the survey also found that credit card defaults are expected to increase in the coming months.
Karim Haji, global and UK head of financial services at KPMG said: "With the recent energy price cap rise and inflation still elevated, lenders will be watching closely to ensure affordability pressures don’t translate into wider credit stress."
What is the Credit Conditions Survey?
The Bank of England’s Credit Conditions Survey is conducted every quarter by the bank as part of its role in maintaining financial stability, though the results should not be taken as its official views.
The survey asks lenders to report market changes for a three-month period in comparison to the same period a year ago. In this case, it was comparing June, July and August 2025 to the same months in 2024. It also asks lenders for expectations on how the credit market will change over the next three months. In this case, how will June, July and August 2025 differ from September, October and November 2025.
The overall aim is to understand and identify current trends in the credit market, and how lenders expect conditions to change in the near future.
What else did the Credit Conditions Survey report?
The data submitted by lenders showed that demand from homebuyers for mortgage products has not changed significantly since the summer of 2024 and is not expected to change in the next few months. However, there was an increase in demand for remortgaging and an expectation that demand will only grow in the coming months.
There was also an increase in corporate lending demand from small and large businesses, and this is expected to continue for the third quarter of the current financial year. Demand from medium businesses was stagnant, though the expectation is that the next survey will show growth.
How to find the credit card with the longest 0% period
0% credit cards fall into two main categories. 0% purchase credit cards let you spread the cost of your spending over a set number of months. You can then pay off the amount you owe in monthly instalments without paying interest on top, though interest may still be charged on cash withdrawals, balance transfers and transactions made abroad. Once the 0% period ends, you will start being charged interest on your remaining balance.
A 0% balance transfer credit card allows you to transfer one or more credit card balances to your new card and avoid paying interest for a set number of months. You will often need to pay a transfer fee, which is added to your new balance, though some credit cards with shorter 0% interest-free periods come with a lower transfer fee. Once the 0% deal ends, you will start paying interest on your balance.
Some cards can double as both a 0% purchase and balance transfer card.
You can check which card is currently offering the longest 0% period on our 'Best credit cards in the UK' page.
How to pay off a 0% credit card
You are not charged interest on an interest-free credit card until the 0% period ends, but you will still need to make the minimum payment. The best approach is make sure you pay off the balance in full before the 0% period ends. By sticking to just the minimum payment, you could end up spending years paying off even a moderate balance, as the minimum payment will drop as the balance is reduced.
We explain more in our article 'What is the minimum payment on a credit card?'.
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