Average Credit Card Interest Rate

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Average Credit Card Interest Rate


For September 2022, the median interest rate across all credit cards in the Investopedia card database.

Based on average advertised rates from several hundred of the market’s most popular card offers, the median credit card interest rate for all credit cards in the Investopedia database is 20.99% for September 2022. Because the Fed samples a relatively small number of banks and only considers the low end of the interest rate range advertised by card issuers, Investopedia’s average rate data differs significantly from the overall credit card rate average tracked by the Federal Reserve (the Fed), which was most recently quoted to be 15.13% for May 2022. Given that, according to Experian, the average FICO credit score in the United States was 716 as of April 2022, up 5 points from its level in 2020, Investopedia believes it is more accurate to track the median midpoint value of advertised credit card interest rate ranges rather than the low end, as a 716 credit score would not qualify for the best rates available as implied by Fed average rates.

Key Takeaways

  • From Investopedia’s database of over 300 cards, the median offered interest rate is 20.99%.
  • Credit card interest rates are mostly decided by the applicant’s creditworthiness.
  • Those with great credit get the best credit card rates.

Credit card interest rates are likely to rise further in reaction to Fed rate rises in 2022, since most card issuers use variable interest rates tied to the Federal Reserve’s Prime Rate. However, based on competitive pressures and individual banks’ risk standards, the lower and higher ends of possible card rates might alter from month to month. The Federal Reserve has foreshadowed forthcoming rises to its benchmark federal funds interest rate after cutting rates twice in 2019 for general economic reasons and then again in March of 2020 in an effort to use monetary policy to jump-start economic activity during the first COVID-19 crisis. In particular, due to dramatic increases in the consumer price index in Q4 of 2021, Q1 and Q2 of 2022, the Fed has indicated that multiple interest rate hikes will continue in 2022, following the first increase of 0.25% in April, a second of 0.50% in May, and a third of.75% in July to slow economic expansion and resulting inflation. A broad range of consumer loans, including credit cards, are linked to swings in the Fed funds rate, which is the mechanism used by the Fed to promote or restrain lending based on economic circumstances.

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Credit quality is the most critical element influencing how individual credit card rates are established, with those with good credit getting the lowest rates and those with no credit or terrible credit having the highest rates. Other criteria include the kind of credit card and the credit card issuer’s risk-based pricing policy.

Investopedia monitors average advertised rates for new applicants, which are normally provided as a range for each card product, across over 300 card offerings, which are broken down below by credit quality, card type, and card issuer.

Interest Rates by Credit Quality Types

Credit quality ranges may vary based on the kind of score utilized, however the FICO score is the most often used credit score by credit card providers.

Credit quality ranges may vary based on the kind of score utilized, however the FICO score is the most often used credit score by credit card providers. The FICO score ranges for each credit quality level are used to determine credit quality:

FICO Credit Score Ranges
Bad/No Credit350-579

It is vital for people who need to improve or repair their credit to start actively utilizing credit responsibly, which includes always paying bills on time and maintaining usage below 30% of credit limits. If you don’t currently have credit in your name, a secured credit card might be a wonderful place to start. It may take time, but appropriate credit utilization may provide good outcomes in as little as six months and continues to grow over time.

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Interest Rates by Credit Card Types

  • Credit cards that give points, miles, or cash back on purchases are known as rewards cards.
  • Student: Credit cards targeted for college students with low credit history and credit education requirements.
  • Secured credit cards demand a security deposit as an initial credit limit.
  • Company: Credit cards meant for small business owners that provide cost separation, working capital, and often incentives and discounts on business-related purchasing categories.

Interest Rates by Issuer

Credit card companies have varied risk-based pricing practices, which create variance in the interest rate ranges they promote and ultimately assign to consumers depending on accepted applicants’ credit scores.

Prime Rate Trend

Credit card interest rates are typically linked to the Prime Rate plus a margin that varies depending on the card type and the credit quality of the individual account user. The Prime Rate is now at 5.50%, having climbed 150 basis points since the beginning of the year as a result of multiple Federal Reserve rate hikes. The next expected Fed rate hike of 0.75 percent will most likely be reflected in the prime rate in October. The current prime rate has already surpassed the previous decade’s high, which was attained in Q4 2018.

Delinquency Rate Trend

Credit card delinquency rates, defined as accounts 90 days or more past due, have remained around 3% in recent years, peaking at 2.76% in January 2020. However, during the epidemic, the delinquency rate declined to 1.48%, peaking in April 2021. With the introduction of the Coronavirus vaccine, consumers started spending more on their credit cards, fueling inflation and increasing the delinquency rate dramatically to 1.81% as of the end of the second quarter of this year.

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Credit Card Debt Trend

Total consumer revolving credit card debt surpassed $1 trillion immediately before the pandemic, then plummeted to a low of $970 billion in January 2021. Since then, revolving debt has risen beyond pre-pandemic levels, reaching $1.125 trillion in June 2022, owing to robust consumer demand and credit card spending. Pent-up consumer demand, along with supply chain challenges and associated shortages of products and services, has spurred record levels of inflation not seen since the early 1980s.


Investopedia analyzes individual credit card rates on over 300 cards made available to the public by 32 of the country’s leading banks and issuers. The majority of credit card rates are presented as a range from low to high, based on the applicant’s credit score. Investopedia estimates the average mid-point of advertised interest rate ranges as well as the average of the lower and higher ends of rates presented in ranges when calculating average rates by credit quality, card type, card type, or card issuer.

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