Rate Report

Rate survey: Average card APR climbs to record high of 16.71 percent


May 2, 2018: The average credit card interest rate on new card offers set a new record this week, climbing to 16.71 percent, according to the Weekly Credit Card Rate Report

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The average credit card interest rate on new card offers set another new record this week, climbing to 16.71 percent, according to the Weekly Credit Card Rate Report.

The average card APR is now at its highest point since began tracking rates in mid-2007. The national average APR has set a new all-time record 10 times this year. Since rates haven’t fallen once this year, the average card APR breaks a record every time it goes up. The last time the national average declined was last December.

To arrive at this finding, reviewed the APRs, promotional terms and annual fees of 100 U.S. credit cards.

Most card issuers left interest rates alone this week. However, 14 of the cards included in the weekly rate report advertised slightly higher interest rates. Thirteen cards matched the Federal Reserve’s March 2018 rate change by hiking rates by 0.25 percent. When the Federal Reserve revises its benchmark interest rate, the federal funds rate, most U.S. credit cards tied to the U.S. prime rate eventually change rates by the same amount.

One card included in the weekly rate report that is tied to the Libor rate index, rather than the prime rate, also increased rates this week. The store card Cabela’s Club Visa increased its APR range by 0.02 percent. Sporting goods enthusiasts who apply for the card are now offered a range starting at 16.90 percent and maxing out at 25.90 percent.

Average card APRs have climbed by roughly a full percentage point over the past year and are expected to rise again as the Federal Reserve continues gradually hiking rates. The Fed is expected to increase rates at least two more times before 2019 – a decision that could cause consumers to pay significantly more to carry a balance.

If the Federal Reserve increases rates two more times, most consumers’ rates will go up by at least half a percentage point by the end of the year. Depending on how much they owe, that could potentially translate into hundreds of dollars worth of extra interest.

Consumers aren’t opening as many new cards

The higher rates haven’t deterred cardholders from using the cards they already own. According to research released in April by the American Bankers Association (ABA), credit card spending by consumers with good to excellent credit grew significantly in the last quarter of 2017, thanks in part to robust holiday spending.

A small number of consumers also began carrying balances toward the end of the year.

Roughly 44 percent of cardholders revolved a balance in the fourth quarter, while 29.5 percent paid their credit card bills in full. The rest had dormant accounts.

However, despite steadily increasing card usage, consumers’ interest in opening new cards appears to have waned somewhat, the banking trade group found.

For example, consumers opened 1.3 percent fewer accounts in the fourth quarter of 2017 than they did the previous quarter, breaking a nearly five-year trend. The last time the percentage of new card accounts fell from one quarter to the next was in 2013, ABA said.

The number of cardholders opening new credit card accounts in the last three months of 2017 was still higher than it was the previous year. But the rate at which cardholders snapped up new cards was more sluggish than it was in years. “The total number of open credit card accounts expanded in the fourth quarter, but at the slowest pace in nearly three years,” ABA said in a news release.’s Weekly Rate Report

Avg. APR Last week 6 months ago
National average 16.71% 16.68%
Low interest13.53%13.49%12.89%
Cash back16.98%16.93%16.40%
Balance transfer15.93%15.90%15.38%
Instant approval19.05%18.99%18.60%
Bad credit23.77%23.74%23.46%
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: May 2, 2018

See related: Prime rate, federal funds rate and Libor: a primer, Historical credit card rates, 2007-2018


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Rate survey: Average card APR breaks record, climbing to 16.68 percent

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Credit Card Rate Report Updated: September 18th, 2019
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