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Average Credit Card Rate Jumps Half-Point in Three-Week Period

by Peter Andrew
Average Credit Card Rate Jumps Half-Point in Three-Week Period

Weekly Averages:

  • Average consumer credit card rate, overall market: 14.39%
  • Average credit card rate, non-reward consumer cards: 12.82%
  • Average reward credit card rate: 15.06%
  • Average student credit card rate: 14.66%
  • Average business credit card rate (non-reward): 10.68%
  • Average business reward credit card rate: 12.01%

Perhaps inevitably, credit card rates have risen over the three weeks since our last report, and the change is substantial — over a one-half point difference in less than a month. Amidst the current credit crisis and record losses, many credit card companies have simply re-priced rates to the upside for all new cardholders. (Some current cardholders are getting surprise increases as well.) The average credit card rate across all consumer sectors jumped to 14.39% from the 13.86% rate we reported in early November.

The average credit card rate for non-reward consumer credit cards increased to 12.82%, up from 12.40% three weeks ago. The average rate on credit cards with rewards jumped to 15.06% from 14.48%.

The averages listed above attempt to take into account the multiple tiers that many credit card issuers offer, instead of accounting for only the lowest listed rates. However, IndexCreditCards.com also tracks the very lowest listed rates, those reserved for customers with the very best credit. This week those averages are 11.16% (previously 10.99%) for the market as a whole, with a 9.32% average for non-reward cards (previously 9.11%) and a 11.95% average for consumer cards with rewards (previously 11.79%). Note that the rise in rates for customers with excellent credit is not as dramatic as the rise in rates overall.

Student credit card rates finally increased, after being inexplicably untouched for quite some time. (It may simply be that students were being unilaterally rejected, meaning published rates largely didn’t matter.) This week the average rate on student credit cards increased to 14.66%, up from 14.22% three weeks ago. Note, however, that this rate is still below the average rate on general market consumer rewards cards. This rarely happens, suggesting more increases are coming in the student sector.

Small business credit card rates jumped dramatically as well, with the average rate for non-reward business credit cards at 10.68%, up from 10.18% previously, and the average rate for business credit cards with rewards increasing to 12.01% from 11.80%.

Financial institutions represented in the survey include Advanta, American Express, Bank of America, Capital One, Chase / Washington Mutual, Citi, Discover, National City, Pulaski Bank, U.S. Bank, Wells Fargo, and more.

Disclaimer:The information in this article is believed to be accurate as of the date it was written. Please keep in mind that credit card offers change frequently. Therefore, we cannot guarantee the accuracy of the information in this article. Reasonable efforts are made to maintain accurate information. See the online credit card application for full terms and conditions on offers and rewards. Please verify all terms and conditions of any credit card prior to applying.

This content is not provided by any company mentioned in this article. Any opinions, analyses, reviews or recommendations expressed here are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any such company. CardRatings.com does not review every company or every offer available on the market.

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