BACK

Rate Report

Average credit card interest rates: Week of July 1, 2020

The average credit card APR climbs to 16.03% after two lenders raised rates on some of their low interest cards

Summary

The average APR on new credit card offers climbed higher Wednesday after a couple of lenders hiked rates on some of their lowest rate plain vanilla credit cards.

The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.

The average credit card interest rate is 16.03%.

The average APR on new credit card offers climbed higher Wednesday after a couple of lenders hiked rates on some of their lowest rate plain vanilla credit cards.

Citi and HSBC raised APRs on low interest cards this week.

HSBC, for example, increased the APR on its lowest rate balance transfer credit card, the HSBC Gold Mastercard credit card, by a full percentage point. New cardholders are now offered a minimum APR of 13.99% and a maximum APR of 23.99%.

Meanwhile, Citi hiked the APR on one of its lowest rate credit cards, the Citi® Diamond Preferred® Card, by the same amount. The best rate applicants can expect on the basic balance transfer card is now 14.74% – nearly a full percentage point higher than the average APR for balance transfer cards. Citi also increased the card’s maximum APR to 24.74%.

See related: How to do a balance transfer

Average APRs still down significantly since last year

For more than a decade, CreditCards.com has compared the APRs of a representative sample of 100 U.S. credit cards every week, documenting those changes in a database of cards.

According to CreditCards.com’s data, the average credit card APRs that consumers are being offered are still relatively high by historical standards. In July 2015, for example, the average card APR stood at 15% – more than a full point lower than it stands now.

In July 2010, it stood at 14.43%. And in July 2008, the average credit card advertised an APR as low as 11.47%.

However, compared to last summer, when the average card APR surged to an all-time record high of 17.8%, interest rates on brand-new cards are dramatically lower, on average, than they were this time last year.

Year over year, the average card APR is currently down by 1.73 percentage points, which is one of the largest year-over-year rate changes that CreditCards.com has recorded since it began tracking rates in mid-2007.

The lower rates on brand-new offers are largely due to federal interest rate changes that have made it cheaper for banks to borrow. After periodically lowering rates through the last half of 2019, the Federal Reserve pushed rates to nearly rock bottom this spring by cutting its benchmark interest rate by a striking 1.5 percentage points.

Most lenders then passed those cost savings on to new credit card customers by trimming the APRs they advertise. However, some lenders, such as American Express and Wells Fargo, have recently hiked rates on select cards. Others, such as Capital One, have held off on lowering interest rates altogether.

Lenders are required to match federal rate changes on cards that are already open. However, they are free to set APRs on brand new cards as they wish. As a result, the average credit card APR hasn’t fallen nearly as sharply as federal interest rates.

See related: How to lower your credit card interest rate

*Correction: An earlier version of this article incorrectly stated that the PenFed Gold Visa Card’s minimum APR had changed. 

Average credit card interest rates this week

Avg. APR Last week 6 months ago
National average16.03%16.01%17.30%
Low interest12.83%12.79%14.07%
Cash back16.09%16.09%17.35%
Balance transfer13.93%13.88%15.43%
Business13.91%13.91%15.05%
Student16.12%16.12%18.58%
Airline15.48%15.48%16.88%
Rewards15.82%15.82%17.12%
Instant approval18.65%18.65%19.56%
Bad credit24.43%24.43%25.37%
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: July 1, 2020

Historic interest rates by card type

Some credit cards charge even higher rates, on average. The type of rate you get will depend in part on the category of credit card you own. For example, even the best travel credit cards often charge higher rates than basic, low interest credit cards.

CreditCards.com has been calculating average rates for a wide variety of credit card categories, including student cards, balance transfer cards, cash back cards and more, since 2007.

How to get a low credit card interest rate

Your odds of getting approved for a card’s lowest rate will increase the more you improve your credit score. Some factors that influence your credit card APR will be out of your control, such as the length of time you’ve been handling credit.

However, even if you’re new to credit or are rebuilding your score, there are steps you can take to ensure a lower APR. For example:

  1. Pay your bills on time. The single most important factor influencing your credit score – and your ability to win a lower rate – is your track record of making on-time payments. Lenders are more likely to trust you with a competitive APR – and other positive terms, such as a big credit limit – if you have a lengthy history of paying your bills on time.
  2. Keep your balances low. Lenders also want to see that you are responsible with your credit and don’t overcharge. As a result, credit scores take into account the amount of credit you’re using, compared to how much credit you’ve been given. This is known as your credit utilization ratio. Typically, the lower your ratio, the better. For example, personal finance experts often recommend that you keep your balances well below 30% of your total credit limit.
  3. Build a lengthy and diverse credit history. Lenders also like to see that you’ve been successfully using credit for a long time and have experience with different types of credit, including revolving credit and installment loans. As a result, credit scores, such as the FICO score and VantageScore, factor in the average length of your credit history and the types of loans you’ve handled (which is known as your credit mix). To keep your credit history as long as possible, continue to use your oldest credit card so your lender doesn’t close it.
  4. Call your lender. If you’ve successfully owned a credit card for a long time, you may be able to convince your lender to lower your interest rate – especially if you have excellent credit. Reach out to your lender and ask if they’d be willing to negotiate a lower APR.
  5. Monitor your credit report. Check your credit reports regularly to make sure you’re being accurately scored.The last thing you want is for a mistake or unauthorized account to drag down your credit score. You have the right to check your credit reports from each major credit bureau (Equifax, Experian and TransUnion) once per year for free through AnnualCreditReport.com.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

What’s up next?

In Rate Report

Credit card issuers offer cardholders relief amid coronavirus outbreak

As the coronavirus pandemic continues to shutter businesses across the country and a record number of Americans filing for unemployment, some major credit card issuers are offering relief to their customers. Read on to find out what credit card companies are doing to help.

See more stories
Credit Card Rate Report Updated: July 2nd, 2020
Business
13.91%
Airline
15.48%
Cash Back
16.09%
Reward
15.82%
Student
16.12%

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 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.