The rates charged by banks on credit cards vary dramatically so it is worth shopping around. I noticed this when comparing my two credit cards.
Although I pay my card off at the end of the month so the interest rate doesn’t really matter, it is still important to know how much you are being charged in case you do need to use the credit facility.
The difference between my two cards was substantial, with Kulula charging 23,4% and Virgin Money only 18,5%. In addition, Virgin Money pays me 4,5% to have a positive balance on my card while Kulula only pays me 0,5% interest. This allows me to play the system. Virgin has no annual fees and is good place to park my emergency money — it is where I build up my balance to pay for my car services or when the washing machine breaks down. Although Kulula does charge an annual fee — as I travel to Cape Town frequently — their rewards programme is extremely beneficial and has paid for quite a few trips. I have a debit order that pays off the card at the end of the month so I am not paying interest, but I earn my Kulula Moolah. To compare your credit card rate to other banks go onto bank comparison sites www.justmoney.co .za or www.thinkmoney.co.za (see the link under “calculators” on this site).