Kiwibank launches low-interest credit card

3.30pm

Kiwibank today launched a new credit card with an interest rate several per cent below that charged by the majority of its competitors.

The Kiwibank credit card, which will operate through MasterCard will charge 12.9 per cent per annum compared with most other banks' 19 to 20 per cent credit card rate.

Kiwibank said today it will charge an account fee of $19 every six months on the card and no account fee for its customers with a home loan or an account balance of more than $50,000.

The card will also provide up to 55 interest free days on purchases.

Kiwibank chief executive Sam Knowles said there had been strong demand for a low interest credit facility.

"The low interest Kiwibank MasterCard is very competitive," he said.

"More than one and a half million New Zealanders have a credit card. Most card holders pay nearly 20 per cent on their cards and our research has shown a high number are looking for an alternative. This card offers that."

New Zealand Post-owned Kiwibank was set up by the Government just over a year ago in response to concerns over excessive fees and branch closures by the big banks in rural communities and city suburbs. It currently has 135,000 customers.

The bank said it expected the new card to be attractive to existing customers and to further encourage switching of accounts from other banks.

- NZPA