Study: Average APR for new store credit card falls
More Americans say they're likely to apply for a store credit card this holiday season than in either of the previous two years.
Forty-four percent of Americans say they're at least somewhat likely to apply for a store card during the holiday shopping season, up from 32% in 2019 and 24% in 2018, according to a new report from CompareCards by LendingTree. The average APR for a new store credit card is 24.24%, down from 25.41% in 2019, thanks largely to Federal Reserve interest rate cuts.
While the average store credit card interest rates have changed, cards that had high APRs in 2019 tend to still have high rates today. Those with low rates last year tended to have low ones this year. One major positive: For the first time in the three years CompareCards did the study, no card featured an APR of 30% or higher.
The study found that members of Gen X are among the consumers most likely to apply for store credit cards. Seventy-eight percent of Gen X respondents said they were likely to apply for a store card this year. Others likely to apply included parents of kids under 18 (72%), those who were laid off/furloughed due to the pandemic (64%) and men (63%).
Other findings from the survey are below.
• More than half (56%) of those who have had a store card regret opening one (and, in many cases, more than one). In 2019, just 46% of consumers regretted getting a store card.
• Forty-nine percent of those who have had a store-branded credit card currently have debt related to that card.
• Of those who currently have a store-branded card, 59% consider the store card to be their primary card.
• Nearly two-thirds (63%) of consumers said that they'd felt pressured by a sales associate in the past to sign up for a new store card.
• Nearly half (49%) of those who said they felt pressured in the past did actually sign up for the card because of that pressure.