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fees

UK Credit Card Fees Explained and How to Avoid Them

By PointsExplainedLast reviewed

Read the pre-contract information

Before applying, find the section on charges and note the annual fee, late payment fee, cash fee and non-sterling fee.

Automate your repayment

A Direct Debit for at least the minimum, and ideally the full balance, prevents late fees and protects your credit file.

Keep cash off your credit card

Avoid using a credit card to withdraw cash or buy travel money unless you have checked the fee and the interest; issuers often charge these as cash transactions.

Match the card to how you spend

If you often pay in foreign currencies, compare each card's non-sterling fee with its reward rate: a fee larger than the rewards you earn on that spending wipes them out.

Where this comes from

Sources

The documents this guide relies on. If one has changed since we read it, the document is right and this guide is out of date.

  1. Consumer Credit (Disclosure of Information) Regulations 2010, regulation 3 (legislation.gov.uk)

    Pre-contract credit information in good time before the agreement, including each interest rate, charges for payment methods, other charges and conditions for changing them.

    legislation.gov.uk · Accessed
  2. FCA Handbook CONC 7.7: Application of interest and charges

    Default charges must be stated in the agreement (7.7.4G); charges on customers in default or arrears must be no higher than necessary to cover reasonable costs (7.7.5R).

    handbook.fca.org.uk · Accessed
  3. Barclaycard: Cash interest rates and fees

    Cash-like transactions charged at the cash rate and fee (foreign currency incl. travellers' cheques and prepaid currency cards, money orders, wire transfers, digital currencies); no interest on cash if main balance paid in full by the due date.

    barclaycard.co.uk · Accessed
  4. NatWest: What are credit card interest rates?

    Fee for getting cash out; interest charged straight away from the day you take cash out; missing minimum payment could hurt your credit score and stay on your report for six years.

    natwest.com · Accessed
  5. HSBC UK: What is a credit card interest-free period?

    Buying foreign currency, gambling or betting chips and withdrawing cash can carry higher fees even within the interest-free period.

    hsbc.co.uk · Accessed
  6. Barclaycard: Using your Barclaycard when travelling abroad

    Foreign-currency transactions converted at the payment scheme's exchange rate on the day plus a non-sterling transaction fee; combined rate shown on statement; some cards offer no fees on non-sterling transactions.

    barclaycard.co.uk · Accessed
  7. Barclaycard: What is a balance transfer and how does it work?

    Balance transfer fee on the amount transferred, added to the balance; most balance transfers come with a fee; missing a payment or going over the limit can mean paying interest.

    barclaycard.co.uk · Accessed
  8. Consumer Rights (Payment Surcharges) Regulations 2012, regulation 6A (legislation.gov.uk)

    Payee must not charge a fee for payment by a consumer (non-commercial) card-based payment instrument; inserted from 13 January 2018 by the Payment Services Regulations 2017.

    legislation.gov.uk · Accessed
  9. Consumer Rights (Payment Surcharges) Regulations 2012, regulation 6B (legislation.gov.uk)

    The ban in reg 6A(1) applies where both the payer's and payee's payment service providers are in the UK.

    legislation.gov.uk · Accessed
  10. FCA Handbook CONC 6.7: Post-contract business practices

    Persistent debt test compares principal repaid with interest, fees and charges over 18 months (CONC 6.7.27R).

    handbook.fca.org.uk · Accessed
Questions

About this guide

Can a UK shop charge me extra for paying by credit card?

No, not for a consumer card where both the shop's payment provider and yours are in the UK. The Consumer Rights (Payment Surcharges) Regulations 2012 ban surcharges on consumer card payments. Commercial cards are not covered.

Is there a maximum late payment fee?

The FCA's rules do not set a fixed amount. They require charges for customers in default or arrears to be no higher than necessary to cover the lender's reasonable costs, and the fee must be set out in your agreement.

Do I pay interest on a cash withdrawal if I clear my balance?

It depends on the issuer. NatWest charges interest from the day you withdraw cash; Barclaycard says it doesn't charge interest on cash if your main balance is paid in full by the due date. A cash fee usually applies either way.
Keep reading

Balance Transfers, Card Instalment Plans and Buy Now Pay Later in the UK

Credit Card Interest, Minimum Payments and Representative APR in the UK

Credit Reports and Credit Scores in the UK: How They Work and How to Check Yours