What Is the Average Credit Card Interest Rate?

Whether you're looking to apply for a new credit card or checking the terms of your current card, you might be wondering about the average credit card interest rate and how yours might compare. After all, getting a good annual percentage rate (APR) can save you money in interest.

Average interest rate by credit card category

Credit card interest rates aren’t the same across the board. Different kinds of credit cards tend to have different interest rates. For example, you might find that airline credit cards have higher interest rates than flexible cash back rewards cards.

However, while national trends and average credit card interest rates can be useful guidelines, remember that a cardholder’s APR will also depend on their creditworthiness.

What are the different types of credit card interest rates?

Your credit card interest rate might not be one single number. Instead, it might depend on the type of transaction and how you use your card.

Here are some credit card interest rate terms that are important to understand:

  • New purchase intro APR: This is an interest rate you can get as a limited-time introductory offer with some credit cards. A card with a low intro APR on new purchases offers a set period with a low interest rate on regular purchases.
  • Balance transfer intro APR: Like new purchase intro APR, cards with a low intro APR on balance transfers offer a period of low interest for balance transfers. Balance transfers to these cards may still come with balance transfer fees.
  • Penalty APR: Penalty APR is a rate that is charged when a cardholder violates the card’s terms, such as missing a minimum payment. A penalty APR is typically higher than a card's normal APR.
  • Cash advance APR: You might be able to get a cash advance using your credit card. This transaction comes with the cash advance APR, which begins as soon as you withdraw money and can be different from your card’s other interest rates.
  • Fixed APR: A fixed APR is an APR that will stay the same over time.
  • Variable APR: Many credit cards have a variable APR. That means that their interest rate can increase or decrease depending on an index rate, which is tied to larger economic variations. 

3 steps that may get you a card with a lower interest rate

1. Improve your credit score

Working on your creditworthiness can help you qualify for lower APRs on new credit cards. 

If you have revolving credit card debt, paying down that debt can help your credit by lowering your credit utilization ratio. Your credit utilization ratio is the percentage of your total available credit that you’re currently using.

Other ways to improve your creditworthiness can involve looking for errors in your credit report and continuing to build a history of timely payments.

2. Compare credit cards

Credit cards are offered at a variety of rates. Check to see what information is available about credit cards you’re thinking of applying for. 

3. Take advantage of low intro APR

Some credit cards come with low intro APR offers for new purchases and balance transfers. Just be aware of when the intro period ends, and understand any relevant fees, such as balance transfer fees.

Disclosure: This article is for educational purposes. It is not intended to provide legal, investment, or financial advice and is not a substitute for professional advice. It does not indicate the availability of any Citi product or service. For advice about your specific circumstances, you should consult a qualified professional. 

Additional Resources

  • Utilize these resources to help you assess your current finances & plan for the future.

  • Learn how FICO® Scores are determined, why they matter and more.

  • Review financial terms & definitions to help you better understand credit & finances.