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Credit Card Interest Rates Trend Upward

by Peter Andrew

NOTE:

To offer our weekly summary of credit card rates, Credit

Card Monitor, in your publication or on your Web site, please

contact syndicate@indexcreditcards[dot]com.

 

Credit

Card Interest Rates Trend Upward

Average

credit card rates continue to climb. A quarter-point increase

on many American Express cards had the biggest impact on this

week's averages. The increase from American Express was not

surprising, as a hike in federal lending rates last month had

already caused other financial institutions to raise rates.

"Top-level"

consumer credit cards averaged a 9.64% Annual Percentage Rate

(APR) in the latest survey, up from 9.51% last week. The lowest

rate found for consumer credit cards without an annual fee was

the Capital One Platinum MasterCard, offering a 5.9% APR. During

the last week, Capital One shuffled its card lineup, removing

the PrimeLock credit card from its offerings while reducing

the APR on its Platinum card.

"Top-level"

business credit cards averaged a 9.91% APR, up from 9.87%. The

lowest rate for business credit cards with no annual fee was

the Advanta Platinum BusinessCard, offering a 7.99% APR, as

well as a program with travel or cash back rewards.

IndexCreditCards.com uses "top-level" to describe Platinum or

similarly designated credit cards that generally offer the lowest

interest rates to eligible cardholders.

"These

averages are based on the best rates published by the issuing

credit card banks," cautions Adam Jusko, Research Director

for IndexCreditCards.com. "Consumers or businesses with excellent

credit should be able to find cards at these rates, but those

with shakier credit histories may not. If you don't have top

quality credit, add 2% to these averages as a rule of thumb

in determining your probable rate."

IndexCreditCards.com also surveys rates of reward credit cards

for consumers and businesses, as well as student credit cards.

The latest averages include:

    • Reward

    cards for consumers averaged a 10.77% APR, up from 10.75%.

    The lowest APR in this group belonged to the MBNA Rewards

    American Express Card at 7.9%.

    • Rewards

    cards for businesses had an average interest rate of 11.37%,

    up from 11.31%. The Advanta Platinum BusinessCard referenced

    above was the lowest rate offered at 7.99%.

    • Student

    credit card rates stayed steady, with an average 14.72% APR.

    The Wachovia Student Visa offered the best APR at 9.9%. Student

    credit cards generally offer higher interest rates than basic

    consumer credit cards due to students' lack of credit history.

    Financial institutions represented in the survey include Advanta,

    American Express, Bank of America, Capital One, Chase, Citi,

    Discover, MBNA, National City, Providian, Pulaski Bank, U.S.

    Bank, Wachovia, and Wells Fargo.

     

    Published 10/12/05 (Modified 01/21/13)


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