Consumer Payment Card News

Rate Action

While competition has kept the lid on the lower interest rates offered on new cards, the average interest for existing accounts has climbed from 15.62% one-year ago to 16.75%. During this same period, the prime rate has climbed from 4.00% to 5.75% and will hit 6.00% tomorrow since the Fed raised interest rates this afternoon. Platinum cards, which represent 60% of the U.S. market, carry the lowest interest rates. During April the average rate paid for a Platinum card was 15.97% compared to 14.78% one-year ago. Some issuers continue to offer 0% intro rates on some Platinum cards. The average offered go-to rate on a Platinum card, among the top ten issuers, was 11.65% in April. Gold cards, which are largely marketed to lower income consumers and represent 10% of the market, carry an average rate of 18.21% compared to 17.10% one-year ago. Standard cards, which make up 30% of the U.S. market, carry an average rate of 17.82%, compared to 16.82% one-year ago.

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|_3. Credit Card Interest Rate Historical |
|_. | PRIME | CARD |
|_. Apr 04 | 4.00% | 15.62% |
|_. May 04 | 4.00% | 15.67% |
|_. Jun 04 | 4.00% | 15.74% |
|_. Jul 04 | 4.25% | 15.84% |
|_. Aug 04 | 4.50% | 15.91% |
|_. Sep 04 | 4.75% | 15.93% |
|_. Oct 04 | 4.75% | 16.01% |
|_. Nov 04 | 5.00% | 16.18% |
|_. Dec 04 | 5.25% | 16.23% |
|_. Jan 05 | 5.25% | 16.31% |
|_. Feb 05 | 5.50% | 16.41% |
|_. Mar 05 | 5.75% | 16.57% |
|_. Apr 05 | 5.75% | 16.75% |
|_3. Source: CardData (www.carddata.com) |

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