Finding a credit card with no annual or ongoing fees can help keep your overall card costs down. Use the table below to compare balance transfer, 0% purchase, credit builder and rewards credit cards with no annual fee.
Approval for any credit card depends on your status. The representative APRs shown represent the interest rate offered to most successful applicants. Depending on your personal circumstances, the APR you're offered may be higher, or you may not be offered credit at all. Fees and rates are subject to change without notice. It's always wise to check the terms of any deal before you borrow. Most of the data in Finder's comparison tables is provided by Moneyfacts.
What is a no annual fee credit card?
No-fee credit cards let you enjoy a range of benefits without paying a yearly or monthly account fee. Depending on the type of card you choose, you can enjoy no fees for the life of the card or zero fees for a promotional period (such as the first year you have the card). Credit cards with no ongoing fees can help keep your costs low, and are more affordable if you don’t use your card regularly and therefore can’t justify paying high fees.
However, credit cards that involve an annual or monthly fee typically come with more rewards than no-fee cards, so consider how you use your card. It may be the case that added benefits such as travel insurance or cashback on purchases outweigh the expense of the fees involved.
Credit card jargon explained
Annual fee. Sometimes known as an account fee, this is a flat fee you pay each year to use your credit card. However, this generally only applies to premium cards, and many credit cards have no annual or ongoing fees.
APR. The annual percentage rate (APR) is designed to be a benchmark for consumers, providing an annual summary of the cost of your card. As well as the interest, the APR also takes into account any compulsory charges – like an account fee (if there is one). However, crucially, providers only have to award the advertised APR to 51% of those who take out the credit card – the other 49% could be offered a different (higher) rate, at the provider’s discretion. That’s why it’s often referred to as the representative APR.
Interest rate. This is the percentage rate you may be charged on purchases or other card transactions if you don’t pay them off within your interest-free period. Interest rates can be either fixed or variable, meaning they can stay the same, or go up and down, over time.
What is the best no annual fee credit card?
There isn’t one no annual fee credit card that will be best for everyone, and having no annual fee is just one of the features you should look for when comparing credit cards. Understanding what you want to get out of your credit card is the most important factor when choosing the best credit card for you.
For example, if you’re looking to earn rewards on your everyday spending, you might want to consider a cashback or rewards credit card, while if you’re looking to cover the cost of a large purchase, or move an existing debt, a 0% purchase or balance transfer card might be a better option.
Once you’ve decided on the type of card that best suits your needs, you can then take any annual fees into account when comparing cards.
How to choose the best no annual fee credit card
When it comes to choosing the type of credit card that’s right for you, you should keep the following questions in mind:
How often do you use your credit card? If you rarely use a credit card but still want one for unplanned expenses or emergencies, a no annual/monthly fee option will give you the features that you need without burning a hole in your pocket while you’re not using it.
Do you carry a balance? No annual/monthly fee credit cards sometimes have higher interest rates than others, which can mean it takes longer – and is more expensive – to clear a balance. If that’s the case, you might want to consider a low-interest credit card instead.
Do you have existing debt? If you have existing debt, getting a no annual/monthly fee credit card could tempt you to spend more money than you can afford. Aim to pay off your current debts, or consider a balance transfer credit card to save money on interest charges.
What credit card benefits do you want? No annual/monthly fee credit cards sometimes have fewer perks than other options. If you’re interested in features such as rewards programmes and complimentary insurance, make sure you look at a range of cards and consider these factors as well as the annual or monthly fee so that you can find an option that suits all of your needs.
Will you use the credit card after the zero annual/monthly fee promotion ends? If the card comes with no annual fee for a promotional period, consider whether you want to use the card once the introductory period ends. If the card doesn’t have a competitive interest rate or extra features to outweigh the annual/monthly fee cost, you might want to consider switching cards to a zero fee option before the annual fee applies.
Pros and cons of no annual fee credit cards
Pros
Save money on your credit card. The most obvious perk of these cards is that you won’t pay an annual or monthly fee. This could save you a significant amount over the life of the card.
Practical. Without the extra perks and additional benefits, no annual/monthly fee credit cards can be ideal for emergencies and when extra credit is required.
Promotional offers and deals. Some no annual/monthly fee credit cards come with promotional offers, frequent flyer programmes and other perks that you’d regularly have to pay a yearly fee to access.
Cons
Higher interest rates. Credit card companies may charge higher ongoing interest rates on no annual/monthly fee credit cards. This could add to your costs if you regularly carry a balance from month to month.
Fewer extra features. While some no annual/monthly fee cards do come with frequent flyer programmes and other benefits, they usually have fewer features than cards that charge annual or monthly fees.
Temporary £0 annual fee. Unfortunately, not all of these cards offer no annual/monthly fee for the life of the card. If your card only offers zero fees for a promotional period, make sure you know when the standard annual fee will apply and how much it is to avoid any surprise costs.
As there are many types of zero annual or monthly fee cards on the market, it’s important to consider your financial situation and how you intend to use the card. Make sure to consider not only the conditions of the fee, but also the other features, benefits and costs of the card before you apply.
No annual fee credit cards can be a savvy choice for individuals seeking to manage their finances effectively while minimising costs. When selecting such cards, it’s essential to consider factors beyond just the absence of an annual fee, such as interest rates, rewards programs and any additional fees. By carefully assessing your spending habits and financial goals, you can identify the right no annual fee credit card that maximises benefits and minimises expenses, if used responsibly.
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Applying for a no annual fee credit card
The application process is just the same for a credit card with or without an annual fee. Once you have compared all your options and chosen a credit card that suits your needs, you can use a soft credit card checker to see if you’re eligible for the card. Then, when ready, you can apply through the provider’s application form. These forms usually take a few minutes to fill out depending on the provider.
Frequently asked questions
This is possible as long as you don’t have a balance on the card and cancel it before the annual or monthly fee is applied. Contact your provider to confirm exactly when the fee is charged so you don’t accidentally pay it before cancelling the card.
The way you pay the fee depends on your bank and the type of credit card you have. Some credit cards involve a monthly fee, which will be added to your monthly statement. Banks which charge annual fees may charge the full year’s fee upon account activation, or break it down into smaller regular payments. You can either pay the fee in full or over time, as you would pay for any other purchase on your credit card.
If you have a card with a promotional no annual fee offer, the fee will usually apply 12 months after you were approved for the card. If you don’t want to pay this fee when the offer ends, confirm with your bank when the annual fee will be charged and cancel your card before that time.
Some banks will waive annual fees for an extended period if you take out another product with them, such as a loan, savings account or mortgage. You can also ring your bank and simply ask if they’ll consider waiving your fees for longer – they want to retain happy customers, after all.
Because everyone has different preferences and needs, there is no such thing as the “best” no annual/monthly fee credit card. Instead, you should consider whether or not zero fees are a promotional offer or an ongoing feature, and the other costs and features that come with the card. Make sure that the card is an affordable and functional way to manage your finances before you apply.
To keep your travel costs down, you may want to consider a credit card with no annual or monthly fees and no overseas transaction fees, or a card that offers complimentary travel insurance. Also, make sure that the card you’re using is accepted wherever you’re travelling and that it isn’t restricted by economic sanctions.
Many business credit cards offer no annual fee promotions. Business credit cards can often charge high annual fees and/or rates of interest, as they tend to come with a lot of extra features.
Having a bad credit rating can limit your chances of being approved and getting the card.
We show offers we can track - that's not every product on the market...yet. Unless we've said otherwise, products are in no particular order. The terms "best", "top", "cheap" (and variations of these) aren't ratings, though we always explain what's great about a product when we highlight it. This is subject to our terms of use. When you make major financial decisions, consider getting independent financial advice. Always consider your own circumstances when you compare products so you get what's right for you. Most of the data in Finder's comparison tables has the source: Moneyfacts Group PLC. In other cases, Finder has sourced data directly from providers.
Chris Lilly is Head of publishing at finder.com. He's a specialist in personal finance, from day-to-day banking to investing to borrowing, and is passionate about helping UK consumers make informed decisions about their money. In his spare time Chris likes forcing his kids to exercise more. See full bio
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4 Responses
D.GMay 14, 2018
I am looking for a credit card with no monthly/yearly fee. I don’t intend to use it, it is purely to enhance my credit score. Is this a good idea?
Finder
JoshuaMay 14, 2018Finder
Hi D.G,
Thanks for getting in touch with finder. I hope all is well for you. :)
It is worth noting that every time you open a new credit card account, it could cost a few credit score points. Thus, the mere action of opening one can affect your score.
If you don’t intend to use it and you consistently have a zero balance, there’s a chance that your issuer will stop reporting to the credit bureau or worse, close the account. So, in this case, it won’t improve your score and worse, it might even decrease it.
To improve your credit score, you may do the following:
– Order a copy of your credit report. Request a free credit report from the major bureaus to stay on top of making sure that lenders see only the most accurate picture of your financial health. Confirm that your personal information, employment data, open accounts and balances and other financial details are current and accurate. If you discover any errors, dispute them with the three credit bureaus and the provider that reported them.
– Pay down your credit card accounts. Your overall credit score is determined by many variables, including your credit utilization rate. To indicate to lenders that you’re a responsible borrower, only carry a balance with a utilization of 30% or less. For example, if your credit limit is $1,000, keep your balance below $300, which is 30% of your limit.
– Don’t attempt to open new accounts until your score improves. Every time you apply for credit, it’s listed on your credit report and pulls down your score. By waiting, you can take advantage of better interest rates.
– Avoid hastily closing unused accounts. While this sounds like a good strategy in theory, having only newer accounts will result in a lower score. Lenders want to see a long history of credit in your report.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
Kai-uweMarch 16, 2018
Hello, I would like to get a credit card with the lowest costs. I need it just for the UK, purchasing in supermarkets, coffees etc..
Finder
JoshuaMarch 25, 2018Finder
Hi Kai-uwe,
Thanks for getting in touch with finder.
I would like to share with you three pages from our website to help you make a better decision. One option is by looking for no annual fee credit cards. You will find your options on this page.
Next, explore our low interest rate credit cards. On that page, you should be able to get more familiar with credit cards with low interest.
Finally, please go to this page to compare 0% Purchase Credit Card offers.
All the pages I mentioned above will help you find the credit card with the lowest cost.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
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I am looking for a credit card with no monthly/yearly fee. I don’t intend to use it, it is purely to enhance my credit score. Is this a good idea?
Hi D.G,
Thanks for getting in touch with finder. I hope all is well for you. :)
It is worth noting that every time you open a new credit card account, it could cost a few credit score points. Thus, the mere action of opening one can affect your score.
If you don’t intend to use it and you consistently have a zero balance, there’s a chance that your issuer will stop reporting to the credit bureau or worse, close the account. So, in this case, it won’t improve your score and worse, it might even decrease it.
To improve your credit score, you may do the following:
– Order a copy of your credit report. Request a free credit report from the major bureaus to stay on top of making sure that lenders see only the most accurate picture of your financial health. Confirm that your personal information, employment data, open accounts and balances and other financial details are current and accurate. If you discover any errors, dispute them with the three credit bureaus and the provider that reported them.
– Pay down your credit card accounts. Your overall credit score is determined by many variables, including your credit utilization rate. To indicate to lenders that you’re a responsible borrower, only carry a balance with a utilization of 30% or less. For example, if your credit limit is $1,000, keep your balance below $300, which is 30% of your limit.
– Don’t attempt to open new accounts until your score improves. Every time you apply for credit, it’s listed on your credit report and pulls down your score. By waiting, you can take advantage of better interest rates.
– Avoid hastily closing unused accounts. While this sounds like a good strategy in theory, having only newer accounts will result in a lower score. Lenders want to see a long history of credit in your report.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua
Hello, I would like to get a credit card with the lowest costs. I need it just for the UK, purchasing in supermarkets, coffees etc..
Hi Kai-uwe,
Thanks for getting in touch with finder.
I would like to share with you three pages from our website to help you make a better decision. One option is by looking for no annual fee credit cards. You will find your options on this page.
Next, explore our low interest rate credit cards. On that page, you should be able to get more familiar with credit cards with low interest.
Finally, please go to this page to compare 0% Purchase Credit Card offers.
All the pages I mentioned above will help you find the credit card with the lowest cost.
I hope this helps. Should you have further questions, please don’t hesitate to reach us out again.
Have a wonderful day!
Cheers,
Joshua