A balance transfer allows you to move your existing credit card debt from one card to another — usually at a much lower interest rate for a promotional period. Used correctly, it’s one of the most effective ways to reduce credit card interest while paying down debt.
1. The promotional rate (0–2.99%) only applies to the transferred balance — new purchases are charged at the standard rate (19.95%+)
2. You must pay off the transferred balance before the promotional period ends or the revert rate kicks in
3. The transfer fee (usually 1–2% of the balance) eats into your savings — factor it in
4. Don't use the old card again after transferring
How Balance Transfers Work in NZ
- Apply for a new card that offers a balance transfer deal (or accept an offer from your existing bank)
- Request the transfer: Provide the card number and balance from your old card
- Promotional rate applies: For the stated period (e.g., 6 or 12 months), the transferred balance attracts 0–2.99% rather than the standard rate
- New purchases: If you use the new card for spending, those purchases attract the standard rate (typically 19.95%+)
- After the promo period: Any remaining transferred balance reverts to the standard rate
Current Balance Transfer Deals in NZ
Balance transfer promotional offers change frequently — the best current deals should be checked directly with NZ banks. As at June 2026, typical offers include:
| Bank | Promotional rate | Promotional period | Transfer fee |
|---|---|---|---|
| ANZ | 0–2.99% | 6–12 months | ~1–2% |
| ASB | 0–2.99% | 6–12 months | ~1–2% |
| BNZ | 0–2.99% | 6–12 months | ~1–2% |
| Westpac | 0–2.99% | 6–12 months | ~1–2% |
| Kiwibank | Promotional offers available | 6–12 months | ~1–2% |
Check directly with each bank for current promotional offers — these change quarterly.
How Much Can a Balance Transfer Save?
Example: $5,000 balance at 21% currently
Without balance transfer (paying $300/month):
- Time to repay: ~20 months
- Total interest: ~$920
With balance transfer to 0% for 12 months (paying $300/month):
- Transfer fee (~1.5%): $75
- Interest during 12-month promo: $0 (transferred balance)
- Remaining balance after 12 months: ~$1,400
- Then at revert rate (if not repaid): additional interest
Saving vs continuing at 21%: Up to $800+ on a $5,000 balance over 12 months.
The Balance Transfer Trap to Avoid
The most common mistake with balance transfers:
- Transfer $4,000 of debt at 0% for 12 months
- Start using the new card for spending — those purchases charge 21%
- Minimum payments go to the transferred balance first, not the new purchases
- End of promo period: remaining transfer balance reverts to 21%, plus high-rate new purchases
Result: Worse position than before.
How to avoid it: Don’t use the new balance transfer card for any new purchases. Keep your existing low-use card for spending (or use a debit card).
When to Use a Balance Transfer
- You have existing credit card debt at 19–25% p.a.
- You can realistically repay the transferred amount within the promotional period
- You commit to not accumulating new credit card debt
Balance transfers are not a long-term solution — they buy you time at a lower rate. The underlying spending behaviour must change or you’ll be in the same position in 12 months.
Where to check the latest data
Rates, fees and returns change often. Before deciding, check current figures yourself:
- interest.co.nz credit card rates: tables of current credit card interest rates and fees.
- The provider's own website: has its current rates, fees and full terms; these change more often than any comparison page.
- Financial Service Providers Register: shows whether a provider is registered to offer financial services in New Zealand.