What is the average interest rate on credit cards?

The average interest rate on credit cards typically falls within the range of 15% to 25%. This range reflects the rates that consumers generally encounter, influenced by several factors such as creditworthiness, the type of card, and overall market conditions.

Credit card companies set rates based on risk assessment; higher-risk borrowers tend to face higher rates. In recent years, many standard credit cards have had average Annual Percentage Rates (APRs) that can reach into the lower to mid-20s, especially as financial institutions adjust rates in response to changing economic conditions and the federal funds rate.

The other options tend to understate the average interest rates that consumers usually experience with credit cards. As a result, the range of 15% to 25% accurately captures the current landscape of credit card interest rates and helps consumers make more informed decisions about borrowing and credit usage.