Balance transfer refers to the process of moving an existing debt from one credit card or loan account to another, usually to take advantage of lower interest rates or better terms. Typically, individuals transfer balances from higher-interest credit cards to those offering introductory periods with lower or 0% interest rates for a specified time. This process can help reduce interest expenses and consolidate debt into a single account, but it may involve transfer fees and could impact credit scores. The promotional interest rates usually have a limited duration, after which standard rates apply. Proper assessment of fees, repayment terms, and potential impact on credit should be considered before opting for a balance transfer.