Survey: Average card APR climbs to record 15.42 percent

The national average APR on new card offers climbed to an all-time record this week, according to the CreditCards.com Weekly Credit Card Rate Report.

The average APR for new credit cards jumped to 15.42 percent – up from a previous record of 15.36 percent.

J.P. Morgan Chase spurred this week’s rate change by revising APRs on its line of credit cards so that Chase cards align with the Federal Reserve’s December 2016 rate hike. The federal agency raised its benchmark interest rate by 0.25 percent, prompting lenders to increase rates by the same amount.

Chase also hiked APRs by more than a full percentage point on several cards, including the Freedom card and the Slate card. The lowest available APR on the Slate card, for example, was increased to 15.49 percent – up from a previous low of 13.24 percent.

Card use continues to expand
Despite higher interest rates on new and current credit cards, consumers are reaching for their credit cards more often, according to new earnings data released by several bank card issuers, and are charging bigger balances.

J.P Morgan Chase, for example, reported Jan. 13, that credit card sales volume reached a record high of $148.5 billion in the fourth quarter of 2016 – up from $130.8 billion in the last three months of 2015. Total bank card spending, including spending on Chase-issued debit cards, grew by nearly $22 billion.

Meanwhile, Bank of America said that credit card and debit card spending grew by 3 percent, year-over-year, in the fourth quarter.

U.S. Bank reported that credit card loans expanded by 11.2 percent in the final months of 2016, thanks in part to the acquisition of new card accounts from another issuer, and Wells Fargo reported a 7 percent increase in credit card purchases in the fourth quarter.

According to consumer credit data released in January by the Federal Reserve, November was an especially heavy spending month for credit card holders, causing the total amount of credit card debt that consumers carry to surge.

According to the Fed, credit card balances jumped by 13.5 percent on an annualized basis in November – up from a 2.9 percent increase in credit card debt the previous month. 

November’s increase was the steepest increase in credit card balances in months. However, card balances have been steadily on the rise since February, indicating that cardholders may have finally shed their post-recession wariness toward debt.

As a result, credit card balances are currently at their highest point since 2009.

CreditCards.com's Weekly Rate Report
  Avg. APR Last week 6 months ago
National average 15.42% 15.36%
15.18%
Low interest 12.22%
12.16% 11.98%
Cash back 15.57%
15.51%
15.32%
Balance transfer 14.67%
14.61%
14.38%
Business 13.41%
13.39%
13.12%
Student 13.67%
13.67%
13.42%
Airline 15.40%
15.35%
15.08%
Reward  15.48%
15.44%
15.29%
Instant approval 18.03%
18.00%
18.04%
Bad credit 22.98%
22.98%
22.56%
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.)
Source: CreditCards.com
Updated: Jan. 18, 2017

See related: Fed: Card balances surged by $11 billion in November


Join the discussion
We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

The editorial content on CreditCards.com is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company's business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.




Weekly newsletter
Get the latest news, advice, articles and tips delivered to your inbox. It's FREE.


Updated: 11-17-2017