Consumer Payment Card News

Rate Gap

The gap between variable rate credit cards and fixed rate credit cards has widened to 188 basis points. Variable (go-to) rate cards have also saturated the market, now making up 86% of all cards-in-force. Less than five years ago, the number of fixed rate cards outnumbered variable rate cards, according to CardData (“www.carddata.com”:http://www.carddata.com). Today, variable rate cards carry an average go-to interest rate of 16.55% versus 14.67% for the average fixed rate cards. In January, the average go-to variable interest rate was 15.53% versus 14.08% for fixed rate cards. (The averages do not include introductory or punitive interest rates.) During 2006 the prime rate increased 75 basis points.

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|_4. CREDIT CARD INTEREST RATES |
|_. Month | Prime | Fixed | Variable |
|_. Jan 06 | 7.50% | 14.08% | 15.53% |
|_. Feb 06 | 7.50% | 14.11% | 15.75% |
|_. Mar 06 | 7.75% | 14.15% | 15.81% |
|_. Apr 06 | 7.75% | 14.19% | 15.99% |
|_. May 06 | 8.00% | 14.23% | 16.02% |
|_. Jun 06 | 8.00% | 14.32% | 16.10% |
|_. Jul 06 | 8.25% | 14.42% | 16.27% |
|_. Aug 06 | 8.25% | 14.55% | 16.34% |
|_. Sep 06: | 8.25% | 14.58% | 16.40% |
|_. Oct 06: | 8.25% | 14.63% | 16.46% |
|_. Nov 06: | 8.25% | 14.66% | 16.51% |
|_. Dec 06: | 8.25% | 14.67% | 16.55% |
|_4. Source: CardData (www.carddata.com) |

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