Many credit cards allow new customers to transfer an existing outstanding balance from an old card to a new one.

To encourage people to switch cards, lenders also offer deals on the interest that is charged on any money transferred from old cards.

These offers tend to fall into two categories:

• interest-free period (where no additional interest is charged on the money that is transferred for a set period, usually between six and nine months)
• and permanent low rate (where the money transferred is charged interest at a lower rate until it is cleared).

CGS credit cards must make you aware that banks are increasingly charging consumers a fee to conduct a balance transfer (normally no more than £50) after people, branded "rate tarts" - began switching cards every six months and never paying interest.

Consumers should also be aware that many card issuers allow interest to build up on new spending on the card, while any money paid in goes towards clearing the interest-free balances first.