Virgin Creditcards Review: No Annual Fee, Low Interest Rate, Free Rewards

I’ve had a Virgin Credit Card since it first came out, this review will help you use yours better

Be smart and use the 0% interest on balance transfers to your new Virgin Credit Card for the first six months to pay off your credit card balance without incurring even more interest fees on it.

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NOTE: Virgin Credit Cards stopped being issued any more as of April 3, 2008. Existing Virgin Credit Cards were taken over by Westpac who moved people with Virgin Credit Cards onto a similar Westpac credit card by June 2009 but didn’t add an annual fee.

From July 2010 new Virgin Creditcards will be released under a new 10-year exclusive profit-sharing deal which allows Citibank to sell financial services in Australia using the “Virgin” brand and provide funding, infrastructure and banking networks.

Australians owe far more on their credit cards than 10 years ago – $3000+ vs $946. We have outstanding credit card debt of $41 billion and about $30 billion attracts interest.

Even if you assign a conservative annual interest rate of 12 per cent to that debt, consumers hand over a whopping $3.6 billion in interest.

However this doesn’t mean that credit cards are inherently “evil”. If you’re smart you can beat the banks by :

  1. Moving your current credit card balance to a card with 0% p.a. interest on balance transfers for the first 6 months so you can pay it off without the debt growing further.
  2. Closing your existing credit card account and changing to a credit card with no annual fee
  3. Choosing a low rate credit card with no annual fee and a free rewards program
  4. Paying your card off in full the day before the payment is due. This way you basically get a free short-term loan by using the bank’s money for the interest free period (typically upto 55 days)

The perfect credit card for this scenario is the Virgin Mastercard which I personally use and which features (as at Sept 2007):

  • 0% interest on balance transfers to your new Virgin Credit Card for the first six months
  • No annual fee…ever! Why pay a fee every year for the privilege of having a credit card?
  • Low ongoing interest rate, currently 12.99% p.a (at Sept 2007)
  • Up to 55 interest free days on purchases
  • Customer Care Team available 24/7 on the phone – speak to a human, not a machine
  • Automatic free membership to Mates RatesTM instant discounts
  • No application fee or joining fee
  • It’s a MasterCard, meaning it’s accepted at over 30 million locations worldwide

Some people have asked me if Virgin Money Australia offers debit cards or savings accounts – they do not offer these products at present.

However you can read my related articles:
Debit Cards: Better or Worse than Credit Cards?
Whats the difference between Mastercard and Visa?

40 thoughts on “Virgin Creditcards Review: No Annual Fee, Low Interest Rate, Free Rewards”

  1. Don’t forget the new BankWest credit card.. low ongoing rate of about 8.99% – cheaper than any other. If you’re not planning on paying your card off within in the interest free period, it makes good sense to minimise the ongoing rate! C.

    EDITOR: good point. not everyone can afford to pay off a credit card each time the statement is due. In that case, however I think it would be better not to have any credit card at all!

    PS Be aware that the new bankwest lite credit card has a cash advance rate of 19.99% p.a. (as at 18/04/06)

  2. AUSTRALIANS could be saving hundreds of dollars a year by choosing a low-interest rate credit card, according to experts. They say too many cardholders unable to repay the outstanding balance are charged more than 15 per cent interest, when they could be paying less than 10 per cent.

    Credit card interest rates vary from 8.99 per cent to 18.50 per cent, according to data compiled by financial services provider Infochoice.com.au.

    Infochoice general manager Denis Orrock said cardholders could save almost $200 a year on the average debt of $2070 by simply switching from the highest to the lowest interest rate.

    -excerpts from news.com.au article “Credit card savings”

  3. Australian credit card holders have been warned to be wary about being stung by hidden costs amid a surge in new card lenders.

    Wizard Home Loans chairman Mark Bouris warned … many card lenders had high annual fees, more than the average $100 … credit card points programs could also be deceiving … overseas travellers and internet users [should] be careful they don’t end up paying $5 for every $200 spent.

    -excerpt from SMH article “Aussies hit by hidden credit card costs”

    There are more than a dozen cards in Australia that have no-fee [balance transfer] offers, including various cards offered by [Virgin Credit Cards], National Australia Bank, Westpac and Commonwealth Bank. GE offers no-fee cards through Coles Myer, and Wizard Home Loans.

    Most cards use a universal change-of-contract clause, which means the bank can change anything in the contract at will. Only Virgin guarantees that it will never introduce fees on its card, which offers 55 interest-free days of credit, a 12.65 per cent interest rate and a zero-interest balance transfer.

    -excerpt from news.com.au article “Splurge on low-rate cards”

  4. St George launched a low rate credit card with an interest rate of 8.99 per cent … Most Australians would rather have a lower interest rate credit card than one that offers rewards, a survey conducted by Galaxy Research and published by St George Bank found.

    -excerpt from infochoice.com.au newsflash St George launches low rate card

  5. I do have a home loan with St Georges bank and would like to apply for crdit card advertised taking over balance of crrent credit card at zero interest over a period of 6 months and plus minus 8.99% thereafter. Current credit card with National Bank. Would also want to transfer $3000 from ING and invest at St Georges bank. I also have a furter approximately $2000 in my current savings account with National Bank which must be invested with above $3000. Please forward application forms.

    EDITOR: Sorry but I think you’re a bit confused, i’m not a bank 🙂

  6. I would like a low interest, nil annual fee and 55 days interest free credit card. Can you please advise me what cards match these criteria? Thank you.

    David Gentle

    EDITOR:
    You can apply for the virgin credit card online. It matches all your criteria “low interest, nil annual fee and 55 days interest free credit card” plus it has a free “mates rates” rewards program

    I have one myself and cant see the point of a credit card with an annual fee and a high interest rate

  7. Does the virgin creditcard rewards program have any real benefits or is it just cross-promotion and marketing?

    EDITOR: To be fair whether it has benefits for you depends on what products/services you usually buy.

    Some examples where I have benefitted include:

    * 10% off everything in all Virgin Music and Virgin Mega Stores including the co-branded Virgin section of Myer department stores
    * Up to two tickets for the concession rate of $10.00 each at Dendy Cinemas
    * 7.5% off the already discounted price of all books at Seekbooks.com.au
    * FREE portable CD player with MP3, when you spend $200 or more on your Virgin Credit Card in-store at Strathfield Electronics

    NOTE: each special offer has different conditions and you have to mention the offer to the salesperson you’re dealing with to make sure you benefit.


  8. AUSTRALIANS are racking up credit card debt at an alarming rate, according to a survey [by] Cannex Credit .. Mr Willink [Cannex managing director] said there were hundreds of credit cards on the market and consumers should do their homework before selecting a card.

    excerpt from news.com.au article “Credit card debt climbs to $25.3b”

    You think life’s pretty good. Your job is steady, interest rates are relatively low – at least for the time being – and you own your own home. The size of the mortgage is a worry, but only if you think about it. If you don’t, it doesn’t hold you back. You enjoy meeting friends for dinner in restaurants, shopping, overseas travel and owning the latest technology.

    But what if higher interest rates, falling property prices and job losses conspired to bring the whole pack of cards tumbling down?

    For the young who have enjoyed more than 15 years of prosperity, recession is a foreign concept. And even those who have experienced it have long forgotten the fallout.

    Australians have an insatiable appetite for debt which makes them vulnerable to economic shock. In January, consumers held a record 12.6 million credit cards – almost a million more than a year earlier – with an average debt of $2656 a card.

    The jump in applications comes as more banks launch low-interest credit cards, which are popular with the young, or those who hold
    multiple cards and want to consolidate their debt.

    excerpt from SMH Article “Life in the red: Our profligate ways may topple the house of cards”

    This article should provide a stern warning to anyone considering whether to apply for a credit card. When used correctly a credit card can be a useful financial tool providing an easy way to track your expenditure via monthly statements and providing upto 2 months interest free.

    However a lot of people treat their credit card limit like a several $1000 addition to their bank account balance and fall pray to today’s common practice of pursuing instant gratification eg: really large screen TV’s.

    Unfortunately for them this is not the case and they will live to regret their impulse purchase when they dont pay their card off in time or forget to start paying their 12/24 month interest free loan and the interest charges pile up.

  9. Queensland Police’s Detective Inspector Brian Hay said skimming involved copying of the magnetic stripe data on the rear of people’s credit cards. He also urged Australians to frequently check their accounts for irregularities.

    Skimming accounts for 40 per cent of all credit card fraud in Australia and was worth more than $1.3 billion a year.

    excerpt from Today Tonight story “Credit card skimming on the rise”

  10. The Wizard Clear advantage card which is offered by GE Money is fantastic a low interest rate, no annual fee, no atm fees , no fees if used overseas(the only one in the market). The lack of ATM fees means I can use it as a debit card by putting my income onto it every fortnight no bank fees for using an atm and I can use every atm
    Also I like that GE is such a big company(worlds biggest makes me feel safe) and the card looks great and service has been fantastic, the best card in the market

  11. Since I saw some comments about the BankWest credit card it interest -free days, I wanted to be sure people were aware of a couple of things with this card.

    1. If you take a cash advance from the card, you will not only pay interest immediately on that cash advance, but it will also immediately accrue interest on unpaid credit purchases. ie. you lose your interest-free days for that month.

    This bit me several times because I travel overseas a lot. I have one physical (Visa) card that gives me access to all my accounts here in Australia, but when travelling overseas, because BankWest is not connected to Cirrus / Pulse networks, any withdrawl, even if you select savings / cheque, comes out as a cash advance from your visa account. Hence this issue kicks in more often than you would expect.

    There is a way around this – you can get a separate M/C Debit card from BankWest that goes direct to the savings account.

    2. BankWest has recently introduced “Other ATM” fees for customers living in the Eastern States. These do not apply for CBA ATMs.

    Regards,
    Cam

  12. “Richard Branson’s Virgin Money will consider applying for an Australian banking licence as part of its thrust to become a leading provider of direct financial services.

    Newly-installed Virgin Money chief David Wakeley, who is about to announce the financial services company’s next big push into personal loans, told The Australian it would consider applying for a banking licence in the coming months. ”
    – excerpt from theaustralian.news.com.au

    “Virgin Money at present rents its brand name to Westpac, which issues credit cards under the Virgin brand, markets home loans funded by Macquarie Securitisation, and also offers a simple superannuation product, managed by a different Macquarie subsidiary. Macquarie also holds a minority stake in Virgin Money Australia.”
    – excerpt from The Australian newspaper

  13. Before you apply for a credit card, you should make sure that your credit record doesn’t contain any errors which would lead to your credit application being rejected.

    Find out how you can get a FREE copy of your Credit File/Record

    According to Baycorp (A credit record agency) you should avoid making too many applications for credit in a short period:

    “Four applications in a month would be too many and see you refused credit, but four or five applications in six months may be acceptable, once a bank or financial institution has checked other matters such as your job stability and how often you have moved home.”

    – excerpt from theaustralian.news.com.au story “How card shuffle can be bad deal”

  14. How good a deal are you getting from your credit card? While there are some rules of thumb in choosing a card based on your individual spending habits, the competition is so intense and the terms and conditions for individual cards so different it is hard to compare cards.

    [It’s been a while] since the second of this year’s two 0.25 per cent interest rate rises, the fallout has not settled.

    Some issuers, such as Virgin, have absorbed the interest rate increases, it sticking with its 12.65 per cent rate.

    There are more than 20 cards with interest rates from 8.99 to 11 per cent.

    “How do you pick between 21 cards in that space?” Wright [credit card analyst at financial information group Cannex] says.

    “What they are going to be doing is offering simple rewards programs to differentiate themselves.”

    Virgin does this with Mates Rates discounts of up to 5 per cent, for example, with selected retailers such as Rebel Sport.

    – excerpt from news.com.au article “Comparing credit cards”

  15. Financial planners may well need to start asking their clients the question “Who is your favourite celebrity?” after a Virgin Money study found that Australians have racked up an annual $8.7 billion credit card bill to look like their movie idols.

    The latest Virgin Money Celebrity Spending Survey has revealed that two in three young Aussie women max out their credit cards to spend on clothes, hair styles and beauty treatments popularised by the rich and famous, such as Nicole Kidman, Angelina Jolie and Mischa Barton.

    – excerpt from financialstandard.com.au article “Aussies spend $8.7bn on celebrity makeover”

  16. The Virgin Credit Card was launched in May 2003 with a deal that included no fees, a 4.9 per cent introductory rate and balance transfer rate and an ongoing rate of 11.9 per cent. The card captured a 4 per cent share of the credit card market, with 600,000 cards on issue, making it one of the most successful new consumer finance products in some time.

    In January, Virgin Money announced that it would make its card more competitive to increase its market share. The introductory and balance transfer rate was dropped to zero and a rate of 3 per cent was available for three months on purchases over $500.

    – excerpt from SMH article “Winners play low in high-stakes game”

  17. 12 October 2006 – Virgin Money has once again been honored for its outstanding customer service at last Friday’s International Customer Service Professional (ICSP) gala awards night.

    This year Virgin Money was crowned the overall “Outstanding Service Award” as well as the “Medium Business Award” in customer service for 2006.

    Commenting on the awards, Virgin Money Head of Customer Management, Sandra Kennedy said, “It’s fantastic to see that Virgin Money is shaping the customer service experience in Australia. Our credit card, mortgage and superannuation products are some of the best in the market and the excellent customer service that people get with these is what makes the Virgin experience such a great one”.

  18. I recently decided that this was my year of action and I was going to sort out my finances and get further ahead.
    Firstly I got rid of my business bank accounts that charged me for using their services (ie account keeping fees and charges for EVERY transaction) – DONE.
    I’ve been using a Credit Union for my personal accounts for 20 years and have NEVER paid fees, they rock !! But don’t do business accounts.
    Next up was to get rid of the 18% credit card with yearly charges…

    I applied to Virgin for 1 of their Master cards, great deal, low interest, no fees and balance transfer interest rate of 0% for 6 months!!
    My background: I am self-employed, my company earns in excess of $120K pa, I have 2 investment properties and $13K outstanding on a M/C with 18% interest and a $15,500 limit.

    I stated in my application that if Virgin can NOT give me a credit limit the same as I already have, then don’t worry about the card.
    Virgin sent me a card yesterday…. with a $2000 limit!!

    I rang to see what could be done and they said that I have to write a letter to their complaints department, which I have currently drafted and will send when I get home and gather the relevant doco to send as well.

    It’s all great to get these offers but they won’t say why it’s only $2000, just that once I’ve used it for a few months they’ll review my limit, but no promises on an increase.

    I’m now going to get my credit history (as per your other blog page) and see if there’s anything on there that’s a problem.

    It’s all very frustrating, especially as I only want 1 credit card, provided company balance sheets and tax assessments showing $75Kpa and gave them MY criteria for a card. I’m very frustrated at just being a “reference” number. And offered something by a big organisation who do not give reasons when declining.
    Other than the credit reference check, what else could be the problem?

    EDITOR: The low initial limit could be because you’re self employed. I’m told that even people who earn relatively little (around $20,000 / year) can get credit cards with a 5,000 limit if they can show a series of payslips from their employer showing a steady income

  19. I would like to know if virgin credit cards are also available in New Zealand and if so what are the benefits and hidden hooks that i need to know about. Am looking for a credit card with 10,000 limit to take family for holiday to Australia.

    EDITOR:
    Hi marc

    At the moment Virgin Money only offers their products in South Africa, Australia and the UK.

    I suggest you use the free and unbiased credit card comparison service provided by the Consumers’ Institute of New Zealand

  20. I have had a virgin credit card and have generally been happy with it but also got done over by their $2000 limit trick.. which is a convenient way for them to get out of the interest free limit transfer offer if your previous balance is higher than that.

  21. Hi there, am working overseas and getting slugged by the ANZ a huge amount for overseas purchases. Have contacted them and they do not have a card that offers zero fees for overseas transactions. I usually pay off my card each month. Any suggestions for a new card?

    Thanks Mel

    EDITOR: I’d have a go at applying for the Wizard Clear Advantage MasterCard. It has no annual fee. 0% interest for six months on transferred balances. No fees for ATM withdrawals, cash advances or overseas purchases and up to 55 days interest free. Also it can be used on Cirrus and Maestro overseas ATM’s.

    You can call Wizard on +61 3 9445 0190 from overseas

  22. I want a credit card for no annual fee

    EDITOR: This site is sponsored by several credit card comparison sites at the moment.

    Check out the “Sponsored Links:” at the top right hand side of this page to find out which credit card with no annual fee is best for you.

  23. After the frustration with the limit that virgin gave me ($2000), I decided to see what Wizard could offer. They gave me $4000 over the phone…. BUT the best thing…. when I sent in my last 3 citibank statements they simple met the limit on that card. I now have a Wizard MasterCard, with the balance transferred and 0% interest for the next 6 months…. too easy Mr Wizard. Oh… and no annual fees and a low interest rate.
    And no overseas transaction fees from Mr Wizard either.

  24. I have also got a Virgin credit card and I am very happy with it. I have experienced no problems with it so far, also not concerning the limit.
    To my mind it is also one of the best choices at the moment, but I can just urge everyone out there to inform yourself first. This page was one good source where I got information about different cards.

    There are so many companies offering credit cards at the moment and I am constantly bombarded with their advertisements. They just want to take advantage of people who don’t think before applying for a credit card.

    Inform yourself first!!

  25. Hi. I’m interested in the low transfer to a New Virgin Card of a previous credit card from another bank (Almost $10,000).
    What happens if I pay it all off within 4-6 weeks?
    Are there any other fees involved?
    Thanks..

    Any other recommendations? As I’m paying 17% on $10,000 right now!

    EDITOR: As far as I know you’re free to pay off the transferred balance as quick as you want. Make sure to call Virgin on 1800 080 000 to confirm

  26. I have applied to various banks for a credit card to no avail.I have just applied for credit from a loan company which i got approval within 24 hrs.I can’t understand why i was accepted for this loan but not for a credit card.A credit card would have been a better priority to me.I travel every year overseas.I have a great employment history,resident status.What can i do.As i read that if you apply to many times it will go against you.Please can you advises me on this matter.I don’t have a credit rating. Thank you D .Bell

  27. Frankly speaking, when I find such credit cards that have only advantages I doubt if it is really so. There may be disadvantages, but people don’t notice them, as their attention is attracted by positive features.

  28. Westpac has severed its five-year partnership with Virgin Money to provide Virgin branded credit cards.

    Under the agreement, Westpac issued Virgin branded credit cards and provided card infrastructure and credit management. The current agreement between Westpac and Virgin Money will end in 2008.

    Westpac said it will now negotiate with Virgin Money the purchase of the Virgin credit card book from Westpac.

    Virgin Money card customers are not affected and their cards will continue to operate normally.

  29. I was recently discharged from bankruptcy. I am a single mum of 3 on benefits, after a nasty divorce. I paid my bankruptcy out in full early with an inheritance. I have never been silly or irresponsible with finance, I was just left dry by a nasty drunk husband. Now, I have $20,000 change from inheritance and want desperately to buy a home.I have a 4 year old Autistic son who needs me at home so I cant go back to work til he goes to normal school in 2008.I was looking for some advice on how to regain my dignity and financial life again. Im open to any ideas, thank you, anne

    EDITOR: Sounds like you could do with the services of a financial planner

    The problem is that I don’t trust most financial planners because many earn commission money for recommending products that may not be the most suitable for you

    On the other hand a fee for service planner would charge $100’s of dollars if not $1000ish +.

    ASIC provides useful advice about tips for choosing a financial adviser

    Good luck

  30. I need help!!!! I have bad credit but i would like a credit card (limit $1000 to $2000)for emergency. When it comes to pay day I have nothing left to last me for a week?? My husband has had two cancer ops and not working and i have 3 children. Do you know of anyone that could help me???

    EDITOR: I strongly suggest that you contact the Credit & Debt Hotline run by the Consumer Credit Legal Centre (NSW) on 1800 808 488

  31. Hi, I was wondering if this is possible. I currently have a credit card debit of $21,000.00 if I transfered this balance to a new credit card with a 0% interest free rate for 6months when the 6months is up can I then transfer the remaining balance to a new credit card offering the same 0% interest free rate for another six months and keep doing that until the total amount is paid off. Obviously not making any other purchases ever.(How many times would be allowed before the banks catch on). Thanks

  32. Virgin Money Australia has appointed David Baxby as the new chairman of the company following the departure of Macquarie Bank deputy managing director, Richard Sheppard, from the role.

    Virgin Money confirmed that it still has Macquarie Group-nominated Tony Gill on the Virgin board. Lester Doecke will also continue to act as an alternative director for Tony Gill.

    “Macquarie Bank remains committed as a 10 per cent shareholder in the Virgin Money Australia business,” said the spokesperson.

  33. Virgin Money’s struggling Australian business has been handed a lifeline after it negotiated a 14-month extension to its credit card alliance with Westpac.

    The new agreement allows Westpac to continue to manage the 550,000 customer base and ensures that there will be no interruptions to the card service

  34. They’re still doing Virgin Credit Cards in the UK. Why did they disconitue the credit card anyway? In the UK the virgin credit card offers rewards such as discounts on virgin train tickets, virgin flights and other virgin services

    EDITOR: Basically Westpac Bank which issued the cards for Virgin Credit cards in Australia wasn’t making any money from the product even though it held 5% of the Australian credit card market

  35. I applied for the Virgin card at 0% interest for 6 mnths transfer early last year. When it was approved they were pleased to tell me that I could transfer $2200 across to my new card from 10,000 debt on my other card.

    I asked them beforehand and they said it wouldnt be a problem but once I got the card they said no way.

    I told them that they could keep it.

  36. I am looking for a credit card that has no annual fee, 55 free days and a low interest rate. I missed out on the Virgin credit card and have been looking for a similar card ever since. Can you please advise of other deals.

  37. hey Neerav why do you think the virgin card was taken off the market? Do you think they predicted the credit crunch early and got out of the market?

  38. It’s unfortunate that Virgin dropped their credit card, but it WAS a trial for them & obviously the market wasn’t as viable as they had imagined.

  39. Still wondering why Virgin removed their credit cards – that too right after i had applied for them! Damn! Insightful article anyway.

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