The average introductory period on interest-free balance transfer credit cards is becoming more competitive, according to market analysis from MoneyExpert.com.

The number of credit cards offering at least 12 months interest-free on balance transfers has increased from 64 to 72 since November 2009, when it sank to record lows, the study found.

The average period for zero per cent balance transfer credit cards now stands at 9.6 months, compared to 9.3 months in November, but the market remains considerably less competitive than it did two years ago, MoneyExpert has deduced.

In September 2008 there were 176 balance transfer credit cards to choose from, offering an average introductory period of more than 10 months, whereas now this number has fallen to 143 cards.

Borrowers who fail to pay off their credit card balance before the interest free period comes to an end are also being met with higher interest rates, however, which have risen from an average 16.42 per cent in September 2008 to 17.4 per cent now.

Commenting on the findings, Pierre Williams, head of research at MoneyExpert.com, said: “The balance transfer market is showing signs of life and for those people looking to clear Christmas spending, there are a number of competitive deals currently available.”

Explaining why the credit card market remains less competitive than several years ago, Mr Williams added: “The market is yet to recover to pre-credit crunch levels and lenders are understandably cautious with their new lending commitments.”

Mr Williams does not expect the balance transfer credit card market to improve in the coming months, as prominent credit ratings agencies are speculating that the worst of credit card lending defaults is yet to come.

© Fair Investment Company Ltd