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The Average Credit Card Interest Rate In America Today

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What’s the average credit card interest rate in America today?

To find out, LendingTree reviewed about 200 of the most popular credit cards in the country to come up with a comprehensive look at the state of credit card APRs every month and publish the results here.

In this post

What’s the average interest rate on a new credit card offer?

The average APR offered with a new credit card today is 19.49%, up from 19.46% in October.

Average interest rates on new credit card offers in the U.S. for November 2021

CategoryMin APRMax APRAvgPrev month
Average APR for all new card offers15.81%23.17%19.49%19.46%
0% balance transfer cards13.62%22.55%18.09%18.11%
No-annual-fee cards15.28%23.09%19.19%19.18%
Rewards cards15.43%22.99%19.21%19.17%
Cash back cards15.10%22.54%18.82%18.85%
Travel rewards cards15.41%23.52%19.47%19.38%
Airline credit cards15.99%24.26%20.13%20.13%
Hotel credit cards15.20%24.49%19.85%19.85%
Low interest credit cards12.94%22.07%17.51%17.44%
Grocery rewards cards15.13%23.22%19.18%19.12%
Gas rewards cards15.61%23.54%19.58%19.57%
Dining rewards cards15.30%23.44%19.37%19.29%
Student credit cards16.24%21.99%19.12%19.12%
Secured credit cards22.14%22.14%22.14%22.14%

It is the first increase after back-to-back monthly decreases. Both of the previous month’s dips were small — the average fell just three-hundredths of a percentage point in those two months — but they were still noteworthy because they marked a reversal of a slow, steady upward trend dating back to the early days of the pandemic.

Interest rates had been moving higher for months. Those increases were generally tiny, however, leaving card rates as a whole still well below pre-pandemic highs.

The Federal Reserve announced significant rate cuts in March 2020 in response to the COVID-19 pandemic. We saw major decreases in April and May of 2020 as most issuers lowered their APRs in response to the Fed’s moves. In March 2020, the average APR was 20.44%. By May 2020, the average APR stood at 19.21%. Since then, rates have generally gone higher, though shifting just a few hundredths of a point up or down from month to month. Still, those small increases have altogether pushed card interest rates up about a quarter of a percentage point in the past year-plus.

It’s important to know that most credit cards don’t offer just one rate to everyone. They offer a range of possible rates, based on how good or bad your credit is. The better your credit, the lower the rate you can expect, although that’s still not guaranteed as issuers take a variety of factors into consideration when approving you for a new card account.

If you have really good credit, the average APR you can expect to be offered is 15.81%.

If you have really crummy credit, the average APR offered is 23.17%.

That’s a big difference.

The good news is that going into this crisis, the average American had a FICO credit score of 711, according to Experian, the highest in the history of credit scoring. That means that most Americans may be more likely to qualify for that lower interest rate. For those that don’t, however, things get expensive in a hurry.

For example:

  • Say you owe $5,000 on a card and pay $250 per month.
  • With a rate of 23.17%, you’ll pay $1,380 in interest and take 26 months to pay it off.
  • Lower the rate to 15.81% and you’ll pay just $842 in interest and take 24 months to pay it off.

That’s a savings of $538 in interest and two months in payoff time. In normal times, given that most Americans’ financial margin for error is tiny, that’s a big deal. These aren’t normal times, however, so those savings are even more important now.

The type of card you’re shopping for also makes a difference when it comes to what APR to expect. For example, we found that cash back cards and 0% balance transfer cards tend to have lower APRs than travel rewards cards. (That’s true even when you exclude the 0% offer.) Meanwhile, secured credit cards – cards that require a deposit to open and are typically held by folks who are new to credit or are rebuilding their credit – have the highest APRs overall.

What’s the average interest rate on current credit card accounts?

Average interest rate on current credit card accounts

CategoryAvg APR
All credit card accounts14.54%
Accounts assessed interest17.13%

Each quarter, the Federal Reserve releases data on cards that are currently in Americans’ wallets. It looks at the average interest rate for accounts that have been assessed interest – meaning those accounts that weren’t paid in full at the end of the month – as well as an average of all credit card accounts.

It’s important to make the distinction between those two because more than half of active credit cardholders carry a balance. The average APR for all accounts in the third quarter of 2021 was 14.54%, down from the previous quarter, while the average for accounts accruing interest is far higher at 17.13%.

The latter number is the one that really matters, though. After all, a credit card interest rate is a moot point if you pay your bill every month as interest never has the chance to accrue. Unfortunately, that’s not the reality for most Americans.

What’s troubling is that 17.13% is the highest it has been since Q2 of 2019 (when it was 17.14%) and the second-highest since the Fed began tracking these rates in 1994. It’s also a big increase over Q2 of 2021 when that rate stood at 16.30% as well as Q1 of 2021’s 15.91% average.

That’s bad news for those with credit card debt. That means that it is just getting more and more expensive to pay that debt down, and that’s the last thing those folks need.

How have credit card interest rates changed over the years?

Until recently, credit card interest rates had risen steadily in recent years, hitting levels never seen in the decades-long history of the credit card business. Much of that growth has been driven by the Fed, which has also driven the recent spate of decreases.

Prior to those increases, credit card rates were largely stable for several years, following the introduction of the Credit Card Accountability, Responsibility and Disclosure Act of 2009, better known as the Credit CARD Act. The pro-consumer law, signed by former President Obama, brought enormous change to the credit card space. It set limits on when issuers could raise cardholders’ rates, changed how payments must be applied to balances, restricted certain fees and much more. Those changes forced issuers to scramble to figure out how to recoup the revenues lost under the CARD Act. As a result, credit card rates became volatile for several years — one card even famously featured a 79.9% APR for a short time – as banks determined what the market could bear.

Ultimately, all the changes led to overall higher credit card interest rates but relative stability, even as the nation emerged from the Great Recession. That stability lasted until the Fed began raising rates in 2015. Those hikes helped lead rates to the high levels we see today.

What can I do if my interest rate is too high?

These are certainly unusual times. Credit card interest rates have stabilized and, barring any more movement from the Federal Reserve, are likely to remain that way for at least a while. However, it’s more important than ever that you start knocking down your credit card debt in a big way. Obviously, if your financial life has been upended by the coronavirus, that may not be possible. However, if you still consider yourself healthy financially, one of the best things you can do is pay down your debt in order to free up more cash for a rainy day fund.

You also have more power over your credit card’s APR than you realize. Here are two concrete steps you can take that can have a significant impact on your credit card’s interest rates.

Get a 0% balance transfer credit card: It may seem counterintuitive to fight credit card debt by getting another credit card, but these 0% offers can be a godsend, and banks are eager to lend. Many cards offer 0% introductory periods of 12 to 15 months on purchases and balance transfers, with some even offering 18 to 21 months.

If you’re knee-deep in card debt, a yearlong reprieve from interest on a transferred balance can make a huge difference. Just make sure that before you apply, you understand all the fees, deadlines and rules associated with the card.

These cards were hard to come by for much of the past 18 months. Banks just weren’t eager to take on transferred balances in a time when so many people were out of work or otherwise struggling financially. They simply saw it as too risky. However, banks’ appetite for these cards has apparently returned, so there are plenty of offers to choose from when shopping around.

Ask your issuer for a lower rate:  A March 2021 LendingTree survey found that 83% of cardholders who asked to lower their credit card’s APR were successful. The average and median reductions were 10 percentage points. That’s a big deal! The problem is that just 27% of cardholders asked. The best way to go about it is to find credit card offers that you would qualify for at sites like LendingTree or in your snail mail, and use those to frame your negotiations. Say something like, “I love my card, but it has a 24% APR and I’ve just been offered a card with an 18% APR. Will you match it?” There’s a good chance that they’ll work with you.

Just know that you’ll have to make that call and ask for it. They likely won’t come to you.

Methodology

For new credit card offer APRs, LendingTree examined the online terms and conditions for about 200 credit cards from more than 50 issuers, including both banks and credit unions. To gather the data, we noted the standard purchase APRs listed for each card on each individual issuer’s or retailer’s website. (Introductory or promotional rates are not included in our averages.)

For current credit card account APRs, we used data provided from the latest G.19 consumer credit report from the Federal Reserve.