What is APR on a credit card?

APR (Annual Percentage Rate) is the yearly interest rate charged on your credit card balance. It includes the interest rate but not necessarily all fees. The average US credit card APR is around 24.99%.

How is credit card APR calculated?

Credit card APR is the annual interest rate. The daily rate is APR divided by 365. For 24.99% APR, the daily rate is 0.0685%. Interest accrues daily on your outstanding balance.

What is a good APR for a credit card?

A good APR is typically below 18%. Credit card APRs range from about 15% (for excellent credit) to 30%+ (for fair or poor credit). The average US credit card APR is around 24.99%.

Can I negotiate a lower APR on my credit card?

Yes. If you have a good payment history, call your card issuer and ask for a lower APR. Many issuers will reduce your rate, especially if you mention you're considering a balance transfer to a competitor.

Credit Card APR Calculator

APR sounds abstract — let's turn it into real numbers. See exactly what your interest rate means in daily, monthly, and annual costs.

Your APR

Your Balance (optional)

Leave at 0 to just see rate conversions

Daily Rate

—

APR ÷ 365

Equivalent Monthly Rate

—

Rate that compounds to APR over 12 months

What this means: For every $1,000 you carry on this card, you pay — in interest per month and — per year.

Understanding APR

APR stands for Annual Percentage Rate. But credit cards don't charge interest once a year — they calculate it daily.

Here's the breakdown:

Daily Periodic Rate = APR ÷ 365
Equivalent Monthly Rate = (1 + APR)^1/12 − 1 — this is the rate that, when compounded monthly for 12 months, equals the APR. Note: many cards use the simple formula APR ÷ 12, but the equivalent rate is more precise.
Average Daily Balance Method: The bank averages your balance across the billing cycle, then multiplies by the daily rate and number of days.
Grace Period: Most cards waive interest if you pay your statement balance in full by the due date. Once you carry a balance, you lose the grace period.

The average credit card APR in the US as of 2025 is around 24.99%. Anything below 20% is considered good; above 30% is very high.

Understanding Credit Card APR

APR (Annual Percentage Rate) is the yearly cost of borrowing money on your credit card, expressed as a percentage. Unlike a simple interest rate, APR includes certain fees, making it a more accurate representation of the true cost of borrowing. Credit card APRs are typically variable, meaning they can change based on the prime rate set by the Federal Reserve.

As of 2026, the average credit card APR in the United States is approximately 24-25%. However, APRs can range from 15% for excellent credit to 30%+ for subprime credit. Your specific APR depends on your credit score, payment history, the type of card, and current market conditions.

Types of Credit Card APR

Credit cards often have multiple APRs that apply to different types of transactions:

Purchase APR: The standard rate for purchases. This is the most commonly referenced APR.
Balance Transfer APR: The rate for transferred balances. May have a promotional 0% period.
Cash Advance APR: Usually higher than purchase APR, with no grace period.
Penalty APR: A higher rate triggered by late payments, often 29.99% or higher.
Introductory APR: A temporary low or 0% rate for new cardholders, typically lasting 12-21 months.

How to Lower Your Credit Card APR

If you have a good payment history, call your credit card issuer and ask for a lower APR. Many issuers will reduce your rate by 1-3 percentage points to keep you as a customer. Other strategies include: improving your credit score (every 20-point increase can qualify you for better rates), transferring balances to a 0% introductory APR card, and consolidating debt with a lower-interest personal loan. Even a 5% APR reduction on a $5,000 balance saves $250 per year in interest.