Rate survey: Average card rate remains at 15 percent for fourth week


Interest rates on new credit card offers remained unchanged again this week, according to the Weekly Credit Card Rate Report.

None of the cards tracked by advertised new interest rates. As a result, the national average APR stayed at 15 percent for the fourth consecutive week.  Promotional terms, including interest-free balance transfer offers and introductory APRs, also remained unchanged.

This is the third week this month that issuers have left card terms untouched. According to data, issuers have tweaked rates just a handful of times since Jan. 1. As a result, the national average APR has remained unchanged 22 weeks out of 27.

The few times that average rates have changed, the impact on the national average has been relatively minor. For example, since Jan. 5, the national average APR has increased by just 0.11 percent.

Changes to promotional terms have also been relatively rare.

Demand for credit continues to increase
Despite leaving rates and other terms largely unchanged, card issuers appear to be having little trouble attracting a larger volume of applicants. According to earnings data released earlier this week, cardholders are not only spending more and swiping their cards more often; they're also opening significantly more accounts.

For example, Bank of America reported on July 15 that it opened 1.3 million new credit card accounts in the second quarter of 2015 -- up from 1.1 million new card accounts in the spring of 2014. That's the most cards the bank opened in a single quarter in nearly seven years.

Meanwhile, Wells Fargo said on July 14 that it welcomed 14 percent more accounts in the second quarter of 2015 than it did last year -- thanks in part to its recent acquisition of the Dillards credit card. The number of Wells Fargo bank customers who also own a Wells Fargo card also rose to 42.6 percent in the second quarter -- up from 39 percent in the spring of 2014.

In addition, Wells Fargo reported that transaction growth jumped 18 percent, year-over-year, last quarter, while J.P. Morgan Chase reported on July 14 that transactions rose by 12 percent.

The uptick in transactions shows that cardholders are less queasy nowadays about reaching for a credit card rather than a debit card or cash. After the recession, many cardholders temporarily switched to paying for their purchases using cash or debit in order to avoid over-borrowing on their cards.

Cardholders are also feeling more comfortable with their debt and charging more overall, card issuers' earnings data shows. For example, Chase said that credit card sales volume -- which measures the total amount people charged to their cards -- rose by 7 percent in the second quarter.

Despite spending more overall, most cardholders still aren't charging more than they can afford to repay, card issuers' earnings data shows. For example, late payments on bank-issued credit cards are still more rare than they used to be when people were less careful about maintaining their credit scores. According to a July 9 report from the American Bankers Association, late payments on bank-issued credit cards fell to 2.49 percent of all accounts in the first quarter -- down from 2.52 percent of all accounts at the end of 2014.

According to the American Bankers Association's chief economist James Chessen, credit card delinquencies -- late payments by 30 days or more -- are bound to rise as consumers become more comfortable with their cards. But it could remain near historic lows if people continue to be vigilant about spending only what they can afford to reasonably repay. "Falling unemployment, steady job gains and higher incomes may have driven delinquencies rates down to about as low as they can go," said Chessen in a news release. "Maintaining these low delinquency levels is possible as long as consumers remain focused on managing their level of debt. People have done a great job over the last few years and hopefully the lessons of the past will continue to pay dividends well into the future."'s Weekly Rate Report
  Avg. APR Last week 6 months ago
National average 15.00% 15.00%
Low interest 11.62%
11.62% 10.24%
Cash back 15.27%
Balance transfer 14.12%
Business 12.85%
Student 13.14%
Airline 15.10%
Reward  15.14%
Instant approval 18.00%
Bad credit 22.73%
Methodology: The national average credit card APR is comprised of 100 of the most popular credit cards in the country, including cards from dozens of leading U.S. issuers and representing every card category listed above. (Introductory, or teaser, rates are not included in the calculation.)
Updated: July 15, 2015

See related: Fed: May credit card balances rise again, Americans sleeping better as economy recovers

Published: July 15, 2015

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