INTRODUCTION

At the beginning of this year (2009), I was on the look out for a new credit card as my current provider (Natwest) were dithering for too long as to whether they wanted to extend my credit limit, which currently sits at a very modest £1600. I also wanted to find a new credit card with a 0% interest free introductory rate on purchases, as my 6 month 0% offer with my Natwest Gold card was on the verge of expiring.

I have held a current account with the Halifax since 1996, though for the past few years this account has been what can be best described as "dormant", in other words I had forgotten about the one pound something that I left in there. Spurred on by the promise of a new year and the resolutions that come with it, I decided to dust off my Halifax statements and set up a Reward Current account (where you have to pay in £1000 each month to "earn" a £5 reward). At the same time, I decided to apply for a Halifax All in One credit card (Mastercard) as they were (and still are at the time of writing) offering an attractive introductory rate of 0% interest for 9 months on purchases. I can honestly say that the all singing and dancing "Howard" from the Halifax TV adverts had no bearing on my decision - by the way, whatever happened to Howard?

THE APPLICATION PROCESS

I applied for the Halifax All in One credit card at the same time as opening the Reward current account at my local branch in Hanley. I popped in on a cold brisk Saturday morning in early February and was given an appointment with an advisor the following week. The application process for the credit card was quite simple, it was a matter of providing your personal details and answering a few financial questions such as your current salary and other forms of credit that you have. The Halifax advisor discreetly turned the computer monitor away from my watchful eye to determine if I had a good credit score and.... Success! I was accepted for a Halifax card which had a much higher credit limit. In terms of customer service, I was very impressed with the friendliness of the advisor that took me through the application process, particularly considering Halifax was one of the banks under a very gloomy financial cloud, and had just been "bailed out" by the Government.

The success of my application was (in my opinion) due to my fairly active use of my Natwest Gold Credit card which as mentioned above, also had a introductory rate of 0% for 6 months. On this card I was paying off the minimum amount on the balance each month as no interest was accumulating. From what I have learnt, your credit rating seems to be boosted if you are not a person that pays off the balance in full every month, but one that only pays the minimum amounts instead. I will discuss further below what I did with the money that I should in theory have used to pay off the monthly credit card balance.

FEATURES OF THE ALL IN ONE CARD

The Headline Features

As mentioned above the all in one card offers 0% interest for the first 9 months on purchases. Another attractive feature, though not one that I was interested in, is that this card also offers 0% interest for 9 months on balance transfers made in the first 90 days. However, a handling fee of 3% applies for each balance transfer. To make sure that you benefit for the 0% rate you need to ensure that you stay within your agreed credit limit and that you make repayments on time. You do not benefit from the 0% balance transfer offer if your hold another card with either the Halifax or Bank of Scotland.

Anything else?

The card also offers:
- Cover against online fraud when purchasing on the internet;
- A card replacement if lost;
- No annual fee;
- Management using the Halifax online banking website;
- Payment protection insurance; and
- A range of funky colours - you can choose your card in one of 5 colours (black, pink, navy blue, white or red).

MY PERSONAL EXPERIENCE

0% interest free period for 9 months

As I mentioned above the most desirable feature for me was the 0% 9 month offer on all purchases. This is now not the greatest length 0% interest free on purchases period available, as the Tesco Clubcard credit card, for example, offers an introductory 12 month interest free period. Even so, when I signed up to this credit card in February earlier on this year, the All in One card offered the longest interest free period.

This allowed me to simply spend, spend, spend with this card and pay off the minimum amount each month without accruing any interest. Instead of using the money from my salary to pay off the credit card balance in full each month, I put this money in a savings account so that I could earn interest on this money. I followed a similar method with my Natwest Gold card whilst it was still within the 6 month 0% purchase rate and have found this a useful way to earn a few extra ££s from the credit card companies. The Money Saving Expert refers to this practice as being a credit card "tart" - see more details in the link below.

http://www.moneysavingexpert.com/cards/best-0-cre dit-cards

My 9 month interest free period expired at the end of November and I thankfully remembered to pay off the entire balance in full and "pocketed" the interest.

You need to be aware that the 0% period does not apply to cash advances (i.e. where you withdraw money from a cashpoint) so NEVER, EVER withdraw money from this card. If you do, the money you withdraw will be subject to a monthly interest rate of 2.075% and an annual interest rate of 27.95%. To add insult to injury, you would also be charged a cash advance fee of 3% of the money you have withdrawn or a minimum of £3.

Online Banking

I found the Halifax online banking service fairly straightforward and user friendly. Firstly you need to set up your online banking with Halifax, and once this is arranged you need to enter in your arranged username and password. I can access my credit card account by clicking on the mostly concealed credit card number (except the final 4 digits). The summary page is neatly spaced out with all of the key information present in a rectangular box at the top of the screen. Here you can easily determine your current balance, the next payment due date, the date the last payment was received, the minimum repayment required and amount of last payment received. The individual transactions are itemised in a standard statement format where you can peruse the date and description of each transaction and depress yourself with how much you have spent.

The online payment facility is also very simple, beneath the statement there is a button, "Online Payment" which after clicking takes you to a new screen to allow you to select the account from which you would like to make your payment from. Once you have picked your account (for me this is the Reward account) you can pay the minimum amount or select another amount which is useful if you wish to pay the balance in full, for example. Once you have entered in your amount, simply click on "Submit" and your payment has been made. Halifax recommends you should allow 4 bank working days for the payment to be arranged, in my experience payment usually takes less time than this, typically 2 days. You can also arrange payments by Direct debit, I did not use this facility, but if you are to follow paying the minimum amount over the interest free period, this would be the safest way not to forget paying your bill!

Replacement card

I rather foolishly managed to "lose" my card in August. As soon as I realised, I raised the alarm with the Halifax 24 credit card helpline who were friendly, efficient and immediately cancelled the lost card after asking a couple of security questions. A new card arrived in 2 days and had the same pin number as my lost card. I was also not charged for a replacement card which was a welcome surprise. To my annoyance I managed to find my lost card at home later that week, but nonetheless I was still impressed with the speed at which Halifax sent me a new card. The new credit card number was also speedily included on my online banking account.

Repayments cover

One aspect of this card I did not touch with a bargepole is the "optional" credit card repayments cover. In a nutshell, your minimum repayments each month could be covered for up to 12 months in the event:

- You are unable to work for 15 consecutive days because you have suffered an accident or sickness
-You are working and become unemployed for at least 15 days (through no fault of your own)
- You were confined to hospital for at least seven consecutive days or more
The repayments cover *could* pay 10% of either the outstanding balance or highest balance (in the preceding statement month) whichever is the greater but no less than £10 up to a maximum of £2,500 a month.

You meet the eligibility criteria for repayments cover if you are aged 18-65, live in the UK and are in paid work and paying National Insurance Contributions class 1 or 2. The cover costs 87p per £100 of your highest card balance each month, so if you had an outstanding balance of £1000 this equates to £8.70 per month or £104.40 a year.

I decided to steer well clear as I have heard and read a lot of bad publicity about payment protection insurance from bank products that are significantly overly expensive and you could obtain this cover (if you felt you needed it) by purchasing separate stand-alone insurance. Another aspect to consider is that the minimum repayment would not be covered after the 12 month period which may not be especially helpful if you have a large outstanding balance. I would recommend reading the following article on the Money Saving Expert website regarding payment protection insurance.
http://www.moneysavingexpert.com/cards/credit-car ds-protection

Interestingly enough, after I activated my card, I stated clearly over the phone that I was not interested in this cover whatsoever, but the Halifax advisor still proceeded to tell me all of the details. So, again I said I was not interested, and then I was asked why not? I found this somewhat aggravating. It is not as if that is the banks business, plus they are also not providing independent financial advice and they have a vested interest in persuading customers to part with an bit of extra money for a service that may not be useful to them.

And the colour?

I decided on a black All in one card, the design looks quite nifty with a white "X" outlined on a mysterious dark black background.

CONCLUSIONS:

- The application process was simple and the Halifax advisor at my local branch in Hanley delivered an impressive level of customer service.
- The 9 month 0% interest free period on purchases is quite attractive, particularly if you use the card for all of your transactions and put your salary in savings account. Don't forget to pay off the minimum amounts each month on time though and to pay off your balance in full at the end of the 9 month period!
- Never use this card for cash advances - the interest free period does not apply and you will get stung!
- The online banking service is straightforward and user friendly.
- The payment protection insurance seems like a waste of money and another way for banks to sell you something that you might not actually want.

SUMMARY INFORMATION
Typical APR: 15.9%
Other APRs: 19.9% APR (variable) and 21.9% APR (variable)

Other interest rates

Purchases:
Introductory rate: 0% for 9 months
Monthly rate: 1.240% or 1.527% or 1.667%
Annual rate: 15.94% or 19.95% or 21.95%

Cash advances:
Monthly rate: 2.075%
Annual rate: 27.95%

Balance transfers:
Introductory rate: 0% for 9 months on Balance Transfers made in the first 90 days
Monthly rate: 1.240% or 1.527% or 1.667%
Annual rate: 15.94% or 19.95% or 21.95%

Cheques:
Monthly rate: 1.240% or 1.527% or 1.667%
Annual rate: 15.94% or 19.95% or 21.95%

Minimum repayment: If the balance is less than £5 then you must repay the full amount. If the balance is £5 or more, you must repay the greater of 1% of the amount you owe us or an amount equal to the total of any Credit Card Repayments Cover premiums, Interest (or the minimum interest charge), overlimit and late payment fees plus £5.

Fees:
Cash Advance Fee: 3% or minimum £3
Foreign Exchange Commission: 2.95%
Balance Transfer Fee: 3% or minimum £3
Cheque Fee: 3% or minimum £3
Minimum Interest Charge: 50p (in any month where interest charge is between 1p and 50p)
Copy Statement Fee: £5
Statement Date Change Fee: £5
Processing any foreign currency payment to us: £10
Stopped Cheque Fee (Other than lost or stolen): £10

Default charges:
Late Payment Fee: £12
Overlimit Fee: £12
Returned Payment Fee: £12
Letter Fee: N/A

© CJG, 2009