Rate survey: Average card APR holds steady at 16.41 percent

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Kelly Dilworth

Personal finance writer
Specializing in new trends in credit

 

Interest
rates on new credit card offers remained at a record high this week, according
to the CreditCards.com Weekly Credit Card Rate Report.

For the
sixth week in a row, the national average APR registered at an all-time high of
16.41 percent.

CreditCards.com
reviewed the APRs, annual fees and promotional terms of 100 of the most popular
U.S. credit cards.

None of
the cards included in the weekly rate report advertised a new interest rate.
Issuers also left promotional terms, such as 0 percent balance transfer offers
and introductory APRs, alone.

Interest
rates are currently at their highest point since CreditCards.com began tracking
rates in mid-2007. Over the past year, the average card APR has expanded by
nearly a full percentage point, causing cardholders’ minimum payments to
significantly increase. On March 14, 2017, for example, the average card APR
was 15.51 percent – 0.90 percent lower than it is now.

Average
card rates are expected to keep growing over the next year as the Federal
Reserve gradually increases interest rates. When the Federal Reserve revises its
benchmark interest rate, most variable rate cards change rates by the same
amount. 

Capital One debuts virtual payment
option for its credit cards

It’s getting
easier to securely pay for goods and services online without disclosing your
credit card number.

Capital
One has added a new feature to its virtual assistant service
Eno that helps you create virtual credit card numbers for your online
purchases. The new service will create a different number for every merchant
you visit. That way, if hackers gain access to the number, they won’t be able
to use it anywhere else.

Capital
One will also store different numbers for retailers you routinely visit so you
don’t have to create a new number every time you shop.

Capital
One is the third major credit card issuer to offer virtual card numbers,
following Bank of America and Citi. Bank of America’s ShopSafe feature allows
cardholders to shop with a disposable number linked to their account. Citi
offers virtual account numbers for a limited selection of Citi cards.

A number
of alternative payment providers and third party account services also allow
cardholders to shop online without using their real credit card numbers. Privacy.com, for example, allows users to
create single-use virtual debit cards for stores they don’t visit often and
custom virtual cards for favorite retailers.

Similarly,
Token
Payments
allows
you to link your favorite credit card to the secure payment platform and pay
for goods and services using virtual numbers, dubbed “tokens,” rather than your
card number.

Corporations
are also starting to use virtual card numbers instead of permanent numbers in
an effort to increase efficiency and protect against fraud. The
business-to-business payment company ComData offers a virtual card service that
generates a temporary Mastercard number for payments to suppliers. ComData
announced March 6 that it’s teaming up with the
payment processor Noventis on a new initiative so that more companies will be
able to make or accept virtual payments.



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