Characteristics of Zero Interest Credit Cards:
1. Zero interest credit cards have a limited, interest free period, normally ranging between 20 to 50 days from the date of purchase. Depending upon the scheme, the period can also range between 3 to 6 months.
2. There are certain eligibility requirements, which have to be met, to own these cards.
3. Usually, the interest rates charged after the interest free period are very high.
4.Another thing to remember is that credit cards issuers do not extend interest free facility to the same customer on two of their cards.
How does the zero interest phenomena work?
Most of these cards try to attract the customer in one of the following three ways:
1. They offer zero interest as a part of promotional scheme while introducing a new card. In this, the interest free period ranges between 3 months or 6 months.
2. Sometimes, credit card issuers have tie-ups with certain stores, malls or brands. On purchasing stuff from these specified stores, malls or brands by using the specific cards, customers are extended zero interest rates for 3 or 6 months.
3. There are certain cards which offer 0 % interest rates on balance transfers from other credit cards. This feature helps those who are already paying high interest rates on their existing credit cards. By switching over, they can pay off their debts at zero percent interest rates.