:max_bytes(150000):strip_icc()/ejOLS-federal-reserve-average-and-median-available-aprs4-a748861e380c4b1e86bad40ea44b5307.png "Average Credit Card Interest Rate for August 2025: 23.99% APR")
Key Takeaways
- The median average credit card interest rate for August 2025 is 23.99%.
- Your credit score and credit history will largely determine your credit card interest rate.
- You’ll likely get a lower credit card interest rate if you have an excellent credit score.
- The best credit cards on the market come with rewards, balance transfer offers, and more, and the right card for you will depend on your situation.
The median average credit card interest rate for August 2025 is 23.99%. Investopedia tracks over 300 credit card interest rates every month. August’s rate remained flat for a third month.
Credit card interest rates tracked by Investopedia are based on median advertised rates across several hundred popular card offers. Investopedia’s average rates differ from those tracked by the Federal Reserve (the Fed), which was most recently reported to be 20.97% for November 2025, because the Fed tracks average stated interest rates across all accounts at each reporting bank.
How Are Credit Card Interest Rates Determined?
Various consumer loans, including credit cards, are tied to movements of the federal funds rate, which is the Fed’s mechanism to stimulate or slow the magnitude of lending, depending on economic conditions.
The Fed maintained the federal funds rate at its peak level for almost 14 months, beginning in July 2023. But on Sept. 18, 2024, the central bank announced the first rate cut in what was expected to be a series of decreases in 2024 and likely 2025. That first reduction was by 0.50 percentage points.
On Nov. 7 and Dec. 18, 2024, the Fed announced additional successive rate cuts of 0.25 percentage points, bringing the federal funds rate to 4.25% to 4.50%. With those cuts, the fed funds rate reached its lowest level since March 2023.
That rate held until three consecutive rate cuts of 0.25 percentage points at Fed meetings in late 2025:
- Sept. 17, lowering the federal funds rate to 4% to 4.25%
- Oct. 29, dropping the federal funds rate to 3.75% to 4%
- Dec. 10, reducing the federal funds rate to 3.5% to 3.75%
The rate stayed at 3.5%–3.75%, its lowest since November 2022, at the Federal Reserve meeting on Jan. 27–28, 2026. The Fed’s next rate announcement will be made after its meeting on March 17–18, 2026.
Most credit card issuers employ variable interest rates indexed to the Federal Reserve’s prime rate, so the federal funds rate policy impacts card interest rates directly. However, available card rates’ lower and upper ends can change monthly depending on competitive pressures and individual banks’ risk policies.
Several factors influence how individual credit card rates are set, the most important of which is credit quality. Those with excellent credit receive the lowest rates, and those with no credit or bad credit receive the highest. Other factors include the type of credit card and the risk-based pricing policies of the specific credit card issuer.
Investopedia tracks average advertised rates for new applicants, typically quoted as a range for each card product, across more than 300 card offers. These rates are shown below and broken out by credit quality, card type, and issuer.
Credit Card Interest Rates vs. Personal Loan Interest Rates
Interest rates for credit cards tend to run in a similar range to those interest rates for personal loans. Credit cards are a type of revolving credit with variable interest rates, whereas personal loan rates are typically fixed for a specific amount and repayment term.
Many consumers use balance transfer credit card offers to consolidate higher-interest credit card debt. Additionally, the best personal loans can also be used for debt consolidation involving credit card debt and other types of consumer debt.
Debt consolidation was the most popular reason for using a personal loan, according to a survey conducted by Investopedia in September 2023.
Interest Rates by Credit Quality Types
Different credit quality ranges can vary depending on the type of score used, but the most popular credit score used by credit card lenders is the FICO score.
Credit quality is defined according to the FICO score ranges for each credit quality level:
| FICO Credit Score Ranges | |
|---|---|
| Very Good to Excellent | 740–850 |
| Good | 670–739 |
| Fair | 580–669 |
| Poor or No Credit | 350–579 |
Tip
For those needing to build or rebuild their credit, it’s critical to begin actively using credit responsibly—always paying bills on time and keeping credit utilization below 30% of credit lines. A secured credit card can be a good place to start if you don’t already have credit in your name. It can take time, but responsible credit use can produce positive results after as little as six months and builds over time.
Interest Rates by Credit Card Types
- Balance transfer: Credit cards that offer a promotional rate, often 0%, for a year or more
- Business: Credit cards designed for small business owners, providing segregation of business expenses, working capital, and often rewards and discounts on business-related purchase categories
- Low cost: Credit cards for those with bad credit or no credit history that often have no annual fee but charge higher interest rates to offset higher credit risk
- Rewards: Credit cards that offer points, miles, or cash back on purchases
- Secured: Credit cards that require a security deposit as an initial credit line
- Student: Credit cards for those with limited credit history and credit education, often for college students
Interest Rates by Issuer
Credit card issuers have different risk-based pricing policies that cause variation in the ranges of interest rates they advertise and eventually assign to customers based on approved applicants’ credit scores.
Prime Rate Trend
Credit card interest rates are predominantly indexed to the prime rate along with a margin, which varies at the card product level and individual account holder’s credit quality. The prime rate stands at 6.75% in March 2026.
Delinquency Rate Trend
Credit card delinquency rates, defined as accounts that are 90 days or more overdue, had been trending below 3% in recent years. However, during the pandemic, the delinquency rate fell to a low of 1.48%, bottoming out in April 2021. Since then, the delinquency rate more than doubled due to increased revolving debt incurred by consumers. The rate stood at 2.94% as of Q4 2025.
Credit Card Debt Trend
Total consumer revolving credit card debt passed the $1 trillion mark just before the pandemic and fell sharply to a low of $970 billion in January 2021. Since then, revolving debt has climbed back beyond pre-pandemic levels to almost $1.33 trillion as of January 2026, as reported by the Federal Reserve.
How We Find the Average Credit Card Interest Rate
Investopedia tracks individual credit card rates on more than 300 network-branded cards offered to the public from 43 of the nation’s largest banks and issuers. Most credit card rates are advertised in the form of a range from low to high, depending on the applicant’s credit score.
In determining average rates by credit quality, card type, or card issuer, Investopedia calculates the average midpoint of advertised interest rate ranges and calculates the average of the lower and upper ends of rates that are expressed in ranges.
