The average annual percentage rate (APR) on credit cards nearly doubled to 22.8 percent in 2023 from 12.9 percent in 2013, costing consumers around $25 billion in interest fees last year, according to an analysis by the Consumer Financial Protection Bureau (CFPB).
The average APR hit the highest level on record at the end of last year, according to the bureau’s analysis of data from the Federal Reserve, which started tracking it in 1994.
The surge in the overall average APR comes as credit card debt has hit an all-time high; U.S. credit card debt topped $1.1 trillion in the fourth quarter of 2023, and delinquencies have ticked up as well, according to the New York Federal Reserve.
And for the second consecutive year, 36 percent of Americans say they have more credit card debt than emergency savings, according to a Bankrate analysis. That’s the highest percentage since it started polling in 2011.
“Since finance charges are typically part of the minimum amount due, this additional interest burden may push consumers into persistent debt, accruing more in interest and fees than they pay towards the principal each year — or even delinquency,” the CFPB wrote.
Read the full article at The Hill