Credit Business

With more competition coming out of the Great Recession among card issuers combined with a smaller pool of demand, there has been a new wave of offers being unveiled by major entities that include much lower interest rates and heftier bonuses for using credit cards for everyday expenses.

The average credit card interest rate for those with excellent credit has dropped below 13 percent, marking a near 2-percent drop in the last twelve months. Unfortunately, this drop is not uniform; for those with poor credit, their interest rates have increased from 17 percent to 20 percent over the last twelve months, making it both more difficult and more expensive for those who are struggling to obtain a credit card.

Still, for those at the top, the perks get even better. The average length of a 0% APR for balance transfers has risen over two percent from last year, meaning that more card companies are offering longer terms for paying down that debt interest-free. Cashback rewards programs have also been a boom, with the average payout increasing by over 15 percent in the same time period.

If you currently have good credit, all of these improvements can lead to you saving anywhere from tens to hundreds of dollars per year, making it even more appealing to maintain good credit if you already have it.

One bad piece of news is the amount of complaints that are being filed by cardholders and applicants: in the past twelve months, these claims have nearly doubled, as reported by the Consumer Financial Protection Bureau. Some of this may be due to the seemingly unfair practices of hiking rates on those with less than great credit, while another part of the situation most likely originates from the CFPB being in full force after legislation was passed in 2010.
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