Rate survey: Average card APR holds at record 16.62 percent

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Kelly Dilworth

Personal finance writer
Specializing in new trends in credit

The content on this page is accurate as of the posting date. Please see the bank’s website for the most current version of card offers.

The
average credit card interest rate remained at a record high Wednesday,
according to the CreditCards.com Weekly Credit Card Rate Report. The national
average APR clocked in at 16.62 percent for the second straight week.

CreditCards.com
reviewed the APRs, annual fees and promotional terms of 100 of the most popular
U.S. credit cards. Most cards included in the weekly rate report left interest
rates alone this week. One card advertised a slightly higher APR. However, the
quarter-point rate hike was too small to significantly affect the national
average.

In
addition, CreditCards.com replaced a discontinued travel rewards card with the
new Barclaycard Arrival Premier World Elite MasterCard. The new BarclayCard
carried a slightly higher APR than the Arrival World MasterCard it replaced and
a higher annual fee. But the rate increase wasn’t large enough to spur an
increase in the national average.

None of
the cards included in the Weekly Rate Report advertised new promotions this
week. Card issuers also left other terms alone.

Consumers warming up to chip
cards

After a
rocky rollout in 2015, chip-enabled cards are finally starting to gain favor
with consumers. According to a new survey commissioned by the financial
services company Fiserv, a growing number of consumers would rather use a
chip-enabled credit or debit card to pay for goods and services than swipe a plastic
card or pay with cash or a check.

The survey
polled more than 3,000 consumers about their payment preferences and found that
plastic cards continue to be consumers’ favorite payment method – especially if
they’re equipped with a secure EMV chip. For example:

  • 36
    percent said they’d rather use a chip-enabled card to check out at a store – up
    from 27 percent a year prior.
  • 30
    percent of consumers say they still prefer to use credit and debit the old-fashioned
    way and swipe a plastic card.
  • 17
    percent say they would rather just use cash.
  • Only
    8 percent prefer to pull out a checkbook rather than pay with cash or a card.

The survey
also revealed that consumers are starting to perceive EMV-enabled cards as more
convenient – a big shift from when EMV cards were first introduced statewide
and consumers complained about the slower method of payment. For example, 32
percent of consumers rated EMV-enabled cards as a convenient form of payment –
up from 20 percent in 2017. Meanwhile, 24 percent of consumers said dipping a chip into an EMV reader was the fastest way to checkout and pay, up
from 15 percent the year before.

EMV-enabled
cards have come a long way in recent years as more retailers accept them and
card networks launch new programs to make them faster and more convenient.
Nearly all credit cards now come equipped with an EMV chip. Meanwhile, most
midsize to large retailers – around 99 percent – have switched to EMV or are
in the process of doing so, according to surveys by the National Retail Federation. The vast majority of small
retailers also told the NRF in 2017 they expected to start accepting EMV-enabled
payments by the end of the year.

Meanwhile,
card networks have implemented a number of fixes in recent years designed to make EMV payments wrap up more quickly. For example, Visa
introduced an upgrade that retailers could use called QuickChip that shaved the
number of seconds it takes an EMV reader to process a payment.
Similarly, Mastercard introduced a similar fix that speeds up transactions
called M/Chip Fast.

At many
retailers, consumers no longer have to wait for a transaction to finish to
insert their cards for payment. Instead, they can insert their card
into a chip reader while a cashier rings up their purchases and then remove
the card before the cashier is finished ringing up their purchases, speeding
up the overall process.

In
addition, card companies are getting ready to speed up EMV-enabled payments by
dropping the signature requirement for bigger ticket purchases. Beginning April
14, Visa, MasterCard, Discover and American Express will stop requiring
consumers to sign their names
to verify an in-store purchase.

Previously,
consumers were typically required to sign their names for purchases that cost
more than $50 – a move that could potentially add several precious
seconds to the transaction and make a retail line move more slowly overall.

CreditCards.com’s Weekly Rate Report

















  Avg. APR Last week 6 months ago
National average 16.62% 16.62%
16.15%
Low interest 13.42%
13.42% 12.89%
Cash back 16.90%
16.90%
16.40%
Balance transfer 15.84%
15.83%
15.38%
Business 14.30%
14.30%
13.68%
Student 16.14%
16.14%
15.70%
Airline 16.59%
16.57%
16.07%
Rewards 16.72%
16.71%
16.24%
Instant approval 18.97%
18.97%
18.60%
Bad credit 23.74%
23.74%
23.46%
Methodology: The national average credit card APR is comprised of 100 of the most popular credit cards in the country, including cards from dozens of leading U.S. issuers and representing every card category listed above. (Introductory, or teaser, rates are not included in the calculation.)
Source: CreditCards.com
Updated: April 11, 2018


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