Best credit cards

Credit cards give you access to a revolving line of credit. You can borrow money for purchases up to a set credit limit. Anything you spend is subtracted from your credit limit and added to the balance you owe. Each month, you'll receive a statement showing how much you owe in total, the required payment and the date it's due by. There's usually an interest-free period but if you don't clear the balance by that date, you'll then start to accrue interest.

APR (Annual Percentage Rate) is the estimated total cost of borrowing money on a credit card over a year, including interest and other fees. You'll often see a representative APR advertised when comparing credit cards. The APR is a set of agreed rules that all credit card providers follow when calculating interest rates. You can use the APR to compare interest rates charged by different providers in a standardised way.

You can withdraw cash using a credit card at a cash machine, but it's best to only do this in an emergency situation as it can be more expensive than purchase costs. If you do withdraw money using your credit card, there may be a limit on how much you can take out. You could also be charged a transaction fee and be charged more interest. The rules vary across providers so check the details before making a withdrawal.

The best credit card depends on how you plan to use it. If you want to spread the cost of a large purchase, look for a 0% purchase card with a long introductory period. If you carry a balance on an existing card, a balance transfer card could save you money. If you pay off your balance in full each month, a rewards or cashback card could earn you money on your spending. Always check the representative APR and any annual fees before applying.

Yes, when you apply for a credit card, the provider carries out a hard credit check which can temporarily lower your credit score. However, using a credit card responsibly and paying it off on time each month can actually improve your score over time. Many providers offer a soft eligibility checker that gives you an idea of your chances of approval without affecting your score.