Credit cards are used for all sorts of different reasons. Some people decide they will take out the MBNA All Round Credit Card so they have a back up for emergencies, while others want to use it for small purchases, such as their food and clothing. When you take out a credit card, you can expect to be able to use it in most places for services and goods.

If you don’t have any savings and an emergency comes up, what will you do? A credit card can be useful for this as you know it is always there, whenever you might need it. If your car breaks down suddenly, you are covered.

What is the MBNA Credit Card?

The MBNA All Round Credit Card is issued by MBNA, a company that was started in 1993. It is all round because it offers 0% interest on balance transfers and purchases for 20 months. Registered in England, MBNA is a registered credit provider and offers various credit cards including money transfer credit cards and purchase credit cards.

MBNA 0% Transfer and Purchase Credit Card Overview

IssuerMBNA Limited
NetworkMastercard
Annual/monthly fees£0
Balance transfers0% for 20 months reverting to 20.93%
Balance transfer fee2.99% for 2 months reverting to 5%
Purchases0% for 20 months reverting to 20.93%
Purchases interest-free periodUp to 56 days
Money transfers0% for 12 months reverting to 20.93%
Cash advances20.93%
Min credit limit£0
Max credit limitNot specified
Additional cards available3
IncentiveEarn up to 15% cashback on purchases through Smart Rewards at popular retailers.

MBNA 0% Transfer and Purchase Credit Card Fees and Charges

Annual/monthly fees£0
Minimum monthly payment2.5% or £25 (whichever is greater) or the total of any interest, default fees and charges plus 1% of the outstanding balance plus any arrears.
Balance transfer fee2.99% for 2 months reverting to 5%
Money transfer fee4% for 12 months reverting to 5%
Foreign usage charge (EU)2.95%
Foreign usage charge (rest of world)2.95%
Cash advance fee5%
Late payment fee£12
Duplicate statement fee£0
Exceeding limit fee£0
Additional card fee£0
Replacement card fee£0
Dormancy fee£0

MBNA 0% Transfer and Purchase Credit Card Application Requirements

Minimum Age18
Minimum income£14,000
ResidencyMust hold a UK bank/building society account. Must hold permanent UK address for 3 years.
AvailabilityAvailable to new customers

Credit Card Tips

We will look at the following:

  • Why a credit card is a good idea
  • The pros and cons of taking out a credit card
  • The other options you can look at instead of a credit card
  • Some tips for managing your card, if you decide this is the option for you.

See if you’re likely to be accepted (in 1 minute!)

credit score
 

The first thing to do is get an accurate measure of your credit score. A recent law means you can get your credit score for free. Do this now. It takes 1 minute. I recommend Experian’s free credit report as this is what most lenders use to assess your credit-worthiness. Don’t worry, checking your score doesn’t impact your score in any way.

Is budgeting an issue?

Are you good at budgeting or do you just tend to spend, spend, spend? If it’s the latter, we would not suggest a credit card will be a good idea for you.

Understanding your spending habits

If you spend money without really giving it much through, a credit card can exacerbate your spending habits.

Are you earning enough?

A credit card can be extremely beneficial for improving your credit score, but this will only happen if you pay for some things with the card, and completely clear off the balance when it comes due each month. You would need to be earning enough for this to happen. Your salary will need to cover all your day to day bills and expenses, with enough left over to cover anything you’ve spent on the credit card too.

Interest may be an issue with the MBNA All Round Credit Card

When you fail to clear the MBNA All Round Credit Card you will have to pay interest, as you would with any credit card.

Take some time to consider if it is likely that interest payments will be an issue and whether you can afford to pay off the card bill when it is due.

Avoiding debt with the MBNA All Round Credit Card

Taking the MBNA All Round Credit Card for the purpose of building your credit score is why many people might open the card. If you have a good credit score, you instantly become more favourable to lenders, and you can get access to better sources of credit. You must learn how to manage it properly though.

Your credit score is impacted by how well you manage your credit in general. How much available credit you are using, and whether you pay bills on time.

When you have a good credit score, you have a better chance of getting a mortgage, getting access to loans and other credit types. It is imperative that you manage the credit card well though, if you want to achieve these good outcomes with your card.

These are some ways you can manage your card well, and therefore, avoid running into debt problems:

  • Stick to one – just because you get accepted for one card, doesn’t mean you should keep taking out more and more. You only need one credit card, you don’t need several.
  • Pay the balance – always aim to clear the balance of your MBNA All Round Credit Card when it is due each month. This will enable you to improve your credit score, making you more attractive to other lenders. It shows you can pay on time.
  • Ignore free offers – Look at any free rewards or offers as an added extra, don’t think of them as a reason to take out a card in the first place.
  • Don’t use all credit – you do not need to use every bit of available credit you have.

Other options instead of the MBNA All Round Credit Card

You might have already decided that a credit card, such as the MBNA All Round Credit Card, is not for you and that is okay. A credit card is not for everyone.

If you want an alternative that doesn’t have the attached risks, a ‘prepaid credit card’ is another good option. This can help you build a good credit score, but you don’t have the potential issue of getting into financial troubles. You can’t spend what you don’t have.

Prepaid credit cards and the key facts

With a prepaid credit card, you need to load the card with cash before you can spend anything. You can’t overspend so there are less risks involved. You can also find them in most places that you would with a credit card, so you don’t need to worry about a lack of places to use it.

These are some benefits of the prepaid card:

  • You can build a good credit score, there is no risk of adversely affecting your credit score
  • It can help you keep track of your money and adhere to a budget
  • Compact enough that it can fit anywhere
  • You have better safety with a card than cash
  • You will be able to keep track of all your spending

When you carry cash around, there is always that uncertainty that if something happens, you will lose your money. Prepaid cards will give you more protection in that respect.

What about a debit card

If you have a bank account, you also have a debit card, as this comes with the account. You can use debit cards anywhere that accepts credit cards, and you can only spend what you have in your accounts. You cannot overspend.

If you are concerned about overspending, you may want to consider a debit card over a credit card. It can help you stick to a budget and also save you from worrying about your money going missing.

Building a credit score without a credit card?

We get used to thinking credit cards are part of our everyday life, and you’re no-one until you have one! However, you don’t need a credit card in your life, even if your main purpose is to improve your credit score. It can definitely help, but it is not the only option.

If you have bills in your name, and you make sure you pay them on time, you will be able to build a healthy credit score. If you do this consistently over a long period of time, you will find that your score will improve.

References

CONC 13.1 Application

CONC 2.1 Application

CONC 5.2A Creditworthiness assessment

About the author

Scott Nelson

Scott Nelson is a financial services expert, with over 10 years’ experience in the industry, including 6 years in FCA regulated companies. Read more
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