Offset credit card

KarlHawley

Does anyone know of anyone who would let me pool my resources by allowing me to offset my credit card balance against a current account/savings account? Intelligent Finance used to do this but withdrew it a few months back as it was unprofitable.

Any help much appreciated.

innovate

Not quite what you have asked for, but probably would have the same effect: Egg Money.

Milarky

Egg money allows you to deposit a 0% credit card balance [as you can balance transfer 'from' it to the 0% card] and pays 4% gross in-credit interest. However it should then be used to super balance transfer [the in-credit balance only] to a current account, and thence savings accounts where it can earn any higher rates available so that purchases then made on the card can benefit from 0% interest-free period and 1% cashback again.

What if they did this instead?...

A true 'offset' credit card would have to get around the tax which your savings account balances generate whilst giving you access to those savings. Egg [or any similar cashback credit card] could do this if they merely offered a higher cashback rate on the initial tier of spending equivalent to the 'gross' interest that they would have otherwise paid you on the in-credit balance.

So, instead of paying 4% gross in-credit, for example, Egg could award 'cashback' at the end of the month at, say '5%' [ that is 1% for all purchases made and a further 4% for any initial amount up to the average [in-credit] daily balance from the month before]. By putting interest on to the balance each month - as now - they have to deduct 20% tax.

This modification would be require the user of the card to give up the normal benefit of an interest-free period, however, since a higher cashback rate will only be earned in respect of an average in-credit balance. In order to be a bit fairer to customers, Egg [or A.N. Other Card] could allow any unused qualifying purchase amounts at the 5% from one month rate to go forward into the following month.. and possibly indefinitely. This would allow customers to only make the purchases they wanted -or would have done. When you closed you account they could convert the unused qualified purchase amounts to a taxed interest payment, so you'd only 'lose out' once.

KarlHawley

Cheers for suggestions but ideally I'd like to move finances to somewhere with current account/savings/credit card/loan facility all in one. Like an offset mortgage without the mortgage part!

With IF I was able to move money from credit card to current account then pay off the credit card balance with the latest 0% deal. So it amounted to a 0% loan and great flexibility. No wonder they withdrew it!

grumbler

KarlHawley wrote:

With IF I was able to move money from credit card to current account then pay off the credit card balance with the latest 0% deal.

You can do the same with Egg Money (i.e. to move money to any current account outside Egg as they don't offer current accounts) ...

http://www.egg.com/visitor/0,2388,3_79766--View_1709-bID_EMonMovingFAQ-dva_1,00.html