Research and Statistics

Cap One’s moves push credit card interest rates higher


Interest rates on new credit card offers surged higher this week, according to the Weekly Credit Card Rate Report, following card adjustments by Capital One.

The editorial content below is based solely on the objective assessment of our writers and is not driven by advertising dollars. However, we may receive compensation when you click on links to products from our partners. Learn more about our advertising policy.

The content on this page is accurate as of the posting date; however, some of the offers mentioned may have expired. Please see the bank’s website for the most current version of card offers; and please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

Interest rates on new credit card offers surged higher this week, according to the Weekly Credit Card Rate Report, following card adjustments by Capital One.’s Weekly Rate Report
Avg. APRLast week 6 months ago
National average14.31%14.23%12.05%
Low interest12.04%12.04%11.45%
Cash back12.63%12.63%12.24%
Balance transfer12.88%12.88%10.46%
Instant approval15.99%15.99%11.57%
Bad credit20.32%19.75%11.74%
Methodology: The national average credit card APR is comprised of 95 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: 6-9-2010

The national average annual percentage rates (APR) on new card offers leapt to 14.31 percent. It’s the second straight weekly increase, and as was the case last week, it’s driven by moves by Capital One. Meanwhile, recent changes by another bank are also likely to mean higher rates for most cardholders, though they didn’t impact our national average.

After boosting rates on three cards last week, Capital One introduced a higher APR version of its Orbitz Visa Platinum card aimed at borrowers with lower credit scores. The issuer also lowered rates on its Venture One Rewards Card, which is designed for borrowers with excellent credit.

What prompted those changes? “In general, details of our pricing strategy are proprietary, but we evaluate different pricing strategies periodically based on the competitive landscape and market conditions,” says Capital One spokeswoman Pam Girardo.

Capital One wasn’t the only issuer that made adjustments. Chase changed its United Mileage Plus Visa Signature card from a single 13.24 percent rate to a range of 13.24 to 19.24 percent, meaning most cardholders are likely to qualify for those costlier rates.

Those increased costs are nothing new, however. For example, a typical cardholder who borrowed $5,000 on a credit card today and consistently paid $150 per month at today’s average interest rate would have to pay $6,412 to pay off the debt. That’s $216 more than would have been required six months earlier.(Calculator: How long will it take to pay off your credit card balance?)

Subprime borrowers, however, are likely to face the greatest expense, as analysts say banks are charging more to cardholders with the lowest credit scores. “I expect the trend of rising rates and the design of creative new fees to apply to the riskier credit segments,” says Dennis Moroney, a research director in the bank cards division at TowerGroup.

See related: Credit card lending standards keep tightening, Fed report says, Credit card reform arrives in the form of the Credit CARD Act, Calculator: How long will it take to pay off your credit card balance?, Credit card rates: interactive graphic on APR changes

What’s up next?

In Research and Statistics

Consumer credit card balances plummet in April

Consumer credit card balances plummeted by $8.5 billion in April, marking a record 19th straight month of decline, according to data released Monday by the Federal Reserve.

Published: June 7, 2010

See more stories
Credit Card Rate Report Updated: October 16th, 2019
Cash Back

Questions or comments?

Contact us

Editorial corrections policies

Learn more

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.

The editorial content on 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.