As attention turns from rewards credit cards to low rate credit cards, we compare features and costs across all bank offers

Competition among banks and non-banks for credit card business is getting more active.

This latest flurry started when Air New Zealand shook up its relationship with BNZ. This brought a number of substantial changes in the 'rewards' sector of the market.

But this is a sector under pressure, especially as card users are better understanding that the level of spending required makes most reward schemes very hard to justify. The 'rewards industry' is making lots of money, but users are not seeing any benefits for all the spending required to claim the advertised advantages.

And this sector is fracturing as more non-banks are joining the fray. We know of yet another one that will be entering the market in a few weeks.

This is seeing many card users focus on fees and card costs, bringing new attention to the low rate card sector.

ASB launched its Visa Light card last week, featuring a zero annual fee. We covered that here.

You can find our full credit card rate tables here.

Today's (Monday) launch by The Co-operative Bank of its Fair Rate card makes this a good time to do a close comparison of the costs of the various low rate cards on offer today.

Bank	Card	Interest free days (max)	Annual fee $	Bal Tsfr rate %	Bal Tsfr period	Cash Adv %	Purchases %
	Low rate Mastercard	55	58***	1.99	12 mths	22.95	13.90
	Visa Light	55	0	0.00	6 mths	22.95	13.50*
BankDirect	Low interest Visa	55	60	na	n.a.	13.60	13.60
BNZ	Low rate Mastercard	55	60	0.00	12 mths	22.95	13.45**
Co-operative Bank	Fair Rate Mastercard	55	20	4.95	12 mths	12.95	12.95
Kiwibank	Low Rate Mastercard	55	50***	1.99	6 mths	19.95	13.45
Westpac	Low interest Mastercard	55	65	5.95	till paid	22.95	13.45
			* Zero for 6 months for purchases of $1,000+
			** Zero for first 6 months
			*** Zero for first year

The new Co-operative Bank "Fair Rate" card also has some other advantages over all other bank offers that are worth noting.

Firstly, by having the same interest rate for cash advances and regular purchases, you won't get the surprise you do with other cards. That is where the bank credits your repayments first to the lowest interest rate components (including any balance-transfer rate), leaving the highest components still incurring interest. Most users do not know of this treatment, and it bites especially hard if you use a credit card to make an ATM cash advance.

And secondly, the new Co-op Bank card won't approve an over-limit transaction, and therefore won't be charging over-limit card fees. These are $15/month at most other banks and apply as soon as you go over-limit. (Update: The Co-operative Bank have advised that they may approve some transactions if the breach is "marginal" - but there will be no approval fee for doing this. The rest of the credit card account needs to be "in order" for this to happen however.)

People with credit cards who just make minimum payments should check out our credit card calculator here. You might be appalled at the huge financial costs of only making minimum payments.