Customer owned banks shine in low rate credit card awards

Father and son sit in front of laptop, holding credit card.

The results of the 2021 Mozo Experts Choice Awards for Credit Cards^ are in and they show customer owned banks excelling when it comes to low rate credit cards. Mutual banks and credit unions made up seven of the ten winners in the best Low Rate Credit Card award category.

It would seem customer owned banks understand that while credit cards can be a useful financial tool, the often high interest rates are something many don’t want hanging over their head. The best Low Rate Credit Card award winners had some of the lowest purchase rates available of all credit cards tracked in the Mozo database. 

How the winners were chosen

To pick the winners, Mozo’s Expert Judges reviewed low rate credit cards based on what their cost would be over a five-year period with a continuous, interest-accruing $4,000 balance.

Our experts took into account the ongoing interest rates that came with each card, any introductory interest rates on offer, the annual fee, as well as any intro annual fee reductions or waivers that may apply. Cards needed to have a minimum 30 interest-free days on purchases to be considered for the awards.

The award-winning low rate credit cards

All seven award-winning low rate credit cards from customer owned banks come with a purchase rate below 10% p.a., an annual fee less than $60 and at least 45 interest free days on purchases.

Both Defence Bank and Credit Union SA stood out for their low six month introductory purchase rates. Defence Bank’s Foundation Credit Card comes with a 3.99% p.a. purchase rate for the first six months which then increases to 8.99% p.a., while Credit Union SA’s Education Community Credit Card comes with an initial 0.00% p.a. purchase rate, which then rises to 9.99% p.a. also after the first six months.

At 7.49% p.a, G&C Mutual Bank’s Low Rate Visa Credit Card has the lowest ongoing purchase rate of the seven. MOVE Bank, Community First Credit Union, Easy Street and Illawarra Credit Union all offer ongoing purchase rates of 8.99% p.a. 

If you’re after a card with a low annual fee, both MOVE Bank’s Low Rate Credit Card and Illawarra Credit Union’s Low Rate Credit Card come with a $0 annual fee for the first year, after which they rise to $59 and $50 per year respectively. Credit Union SA’s Education Community Credit Card comes with an ongoing $0 annual fee.

When low rate credit cards come in handy

Generally, low rate credit cards are designed for people who are after a fairly basic card to help them manage day-to-day finances. The trade-off for offering a low interest rate is that they do not usually come with a rewards program. So if a premium credit card with lots of perks attached is what you’re searching for, a low rate credit card may not be for you.

Besides a lower than average interest rate, low rate credit cards also often come with a fairly low annual fee. While annual fees for rewards credit cards can climb into the hundreds, the yearly fee on low rate credit cards is generally less than $100.

While low rate credit cards are designed to be more cost effective than standard credit cards, there are still traps to watch out for. As with all credit cards, low rate options can come with much higher cash advance interest rates, which apply when withdrawing cash from an ATM with the card. They also usually come with late fees that apply when repayments are not made on time and can charge a foreign exchange fee.

Want to read more about the awards? Check out the methodology report for the 2021 Mozo Experts Choice Credit Card Awards for more information on how the winners were chosen.

Or head to Mozo’s compare low interest credit cards page to see what other cards come with low purchase rates.

Compare low interest rate credit cards - last updated 6 August 2022

Search promoted credit cards below or do a full Mozo database search . Advertiser disclosure
  • Virgin Money No Annual Fee Card

    Virgin Money No Annual Fee for the life of the card. 0% p.a. for 12 months on purchases (reverts to ongoing purchase rate) and balance transfers (reverts to cash advance rate).

    Purchase rate
    0% p.a. for 12 months then 18.99% p.a.
    Balance transfer rate
    0% p.a. for 12 months and then 20.99% p.a.
    Annual fee
    $0
    Details
  • Apply By 31 Oct 2022
    Westpac Low Rate - Cashback Offer

    Enjoy a super low rate of 13.74% with 55 days interest free plus up to $200 cashback - $50 cashback for each month you spend $1,000 or more on eligible purchases in the first 4 months from card approval. New Cards only. T&C's and exclusions apply.

    Purchase rate
    13.74% p.a.
    Balance transfer rate
    6.99% p.a. for 12 months and then 21.49% p.a. (1.00% balance transfer fee)
    Annual fee
    $59
    Details
  • Apply By 31 Aug 2022
    St.George Vertigo - Balance Transfer Offer

    0% p.a. for 32 months on balance transfers requested at card application. 0% balance transfer fee applies. Rate then switches to applicable variable cash advance rate. No annual fee for the first year, $55 thereafter. New cards only, Eligibility criteria and T&Cs apply.

    Purchase rate
    13.99% p.a.
    Balance transfer rate
    0% p.a. for 32 months and then 21.49% p.a.
    Annual fee
    $55 $0 in the first year
    Details
  • Virgin Money Virgin Australia Velocity Flyer Card - Balance Transfer Offer

    Get in the air with a $129 Virgin Australia Gift Voucher each year. 0% p.a. for 28 months on balance transfers.

    Purchase rate
    20.74% p.a.
    Balance transfer rate
    0% p.a. for 28 months and then 20.99% p.a.
    Annual fee
    $129 $0 in the first year
    Details
  • Mozo Expert Choice Badge
    American Express Low Rate Credit Card

    Competitive low rate with $0 Annual Fee. Offers Card Refund Cover and Card Purchase Cover. Customers need an annual income of $50,000 or more.

    Purchase rate
    8.99% p.a.
    Balance transfer rate
    No current offer
    Annual fee
    $0
    Details

^See information about the Mozo Experts Choice Credit Card Awards

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