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ArticlesA balance transfer fee is a charge that may apply when you move eligible credit card debt to another card or balance-transfer facility. It is separate from any promotional interest or profit rate. A low transfer rate can still carry an upfront or processing fee, so compare the total cost of the transfer rather than the advertised rate alone.
How does a balance transfer fee work?
A bank may charge a balance transfer fee when it processes the transfer of an eligible outstanding balance. The fee structure is set by the issuer and should be disclosed in the product terms, Key Facts Statement (KFS) or applicable fee schedule.
The transfer may also have a promotional interest/profit rate for a defined period. These are two different cost components: the transfer fee is charged for arranging or processing the transfer, while the interest/profit rate determines the financing cost on the transferred balance over time.
Balance transfer fee vs promotional rate
| Item | What it means | What to check |
|---|---|---|
| Balance transfer fee | A one-time or stated processing charge for the transfer | Whether it is a flat AED amount or a percentage; when it is charged |
| Promotional rate | The interest/profit rate applied for a defined introductory period | Duration, eligibility and the rate after the promotion ends |
| Regular card rate | The rate that may apply after the promotional period or if terms are not met | How and when it becomes applicable |
Example: comparing the real transfer cost
Illustration only: suppose AED 20,000 is transferred and the bank charges a 2% transfer fee. The upfront fee would be AED 400 before considering any interest/profit charged during or after the promotional period. A competing offer with a higher promotional rate but no transfer fee could therefore be cheaper for a short repayment period. Always calculate the full expected cost for your own repayment plan.
What should you check before transferring a balance?
- The exact transfer fee and how it is calculated.
- The promotional interest/profit rate and how long it lasts.
- The regular rate after the promotional period.
- Whether there is a minimum or maximum transfer amount.
- Whether transfers from the same bank or related cards are excluded.
- How repayments are allocated if the card also has new purchases or other balances.
- Whether early repayment, cancellation or plan changes trigger other charges.
Is a balance transfer always cheaper?
No. A balance transfer can reduce financing cost in some situations, but the result depends on the fee, rate, repayment speed and any new card spending. Moving debt without a repayment plan can simply shift the balance rather than reduce it.
UAE disclosure point
CBUAE Consumer Protection Standards require licensed financial institutions to disclose fees clearly and provide a KFS before a financial product or service is provided. Promotional or introductory pricing must also state the relevant conditions and what applies when the offer ends. Use the issuer’s current KFS and fee schedule for the exact balance-transfer terms.
Frequently asked questions
Is a balance transfer fee the same as interest?
No. The fee is a separate charge for the transfer or plan. Interest/profit may also apply to the transferred balance.
Can a 0% balance transfer still have a fee?
Yes. A promotional rate can be zero while a transfer or processing fee still applies. Read both the rate and fee terms.
Is the balance transfer fee refundable?
That depends on the issuer’s terms. Do not assume a fee will be refunded if you cancel or repay early.
Does a balance transfer increase my credit limit?
No. It normally uses part of an approved credit limit or transfer limit; it does not itself create additional approved credit.
Where can I find the exact fee?
Check the bank’s current KFS, fee schedule and balance-transfer offer terms.