Survey: Average card APR remains at record 15.50 percent

By  |  Published: February 22, 2017

Kelly Dilworth
Personal Finance Writer
Specializing in new trends in credit

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

For the second straight week, the national average APR remained lodged at an all-time high of 15.50 percent. Previously, the highest APR CreditCards.com had recorded was 15.44 percent.

This month marks the first time on record that the national average APR has come within rounding distance of 16 percent. Before this year, the average APR stayed within rounding distance of 15 percent for more than six consecutive years.

None of the cards tracked by CreditCards.com altered interest rates this week. Most card issuers also left promotional terms unchanged.

U.S. Bank strengthened the promotional offer on one of its standard credit cards. Its Visa Platinum cardholders are now given 15 months to make interest-free purchases and balance transfers.

Missed bank payments jump to more than three-year high
As credit card APRs climb to record highs, a growing number of consumers are falling behind on payments.

According to research released Feb. 21 by the credit rating agencies Experian and S&P, the default rate for bank-issued credit cards rose to 3.21 percent in January – up from 2.95 percent the previous month.

Consumers were more disciplined about paying down their home and car loans. The default rates for mortgage and auto loans remained relatively flat in January, indicating that people are generally doing well enough financially to make the majority of their payments.

“While consumer credit default rates on mortgages and auto loans remain low and stable, default rates on bank cards have popped up to the highest level seen since July 2013,” said S&P’s David M. Blitzer in a news release. “Recent data point to consumer optimism: retail sales rose 5.5 percent in January 2017 compared to a year earlier, consumer sentiment measures rose over the last two years and employment and labor market conditions are favorable.”

Consumers are also borrowing more, says Blitzer.

According to Experian’s 2016 State of Credit Report, the average consumer owes $39,216 in combined debt, up from $38,987 the year before. Meanwhile, consumers owe an average of $5,551 on their bank cards, Experian found.  

Banks have also been more lenient about who is accepted for a new card, which has also driven up the delinquency rate, says the credit agency TransUnion.

TransUnion predicted last year that late payments on credit cards were likely to rise in 2017 as interest rates rose and more consumers with blemished credit scores obtained new cards.

“A moderate increase in card delinquency is natural as more subprime consumers have entered the market,” said TransUnion’s Paul Siegfried in a news release. “Most importantly, we remain at relatively low levels of delinquency compared to the recession years.”

CreditCards.com's Weekly Rate Report
  Avg. APR Last week 6 months ago
National average 15.50% 15.50%
15.19%
Low interest 12.36%
12.36% 11.98%
Cash back 15.61%
15.61%
15.32%
Balance transfer 14.76%
14.76%
14.39%
Business 13.41%
13.41%
13.12%
Student 13.67%
13.67%
13.42%
Airline 15.40%
15.40%
15.13%
Reward  15.57%
15.57%
15.30%
Instant approval 18.09%
18.09%
18.04%
Bad credit 23.01%
23.01%
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: Feb. 22, 2017

See related: Card delinquency hits 15-year lowCongress may repeal CFPB prepaid card rule


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Updated: 10-23-2017

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