CFPB’s Analysis of Credit Card Data: Small Issuers’ Lower Rates

The Consumer Financial Protection Bureau (CFPB) regularly surveys and collects information on credit card terms from over 150 issuers of all sizes across the country as required by the law.

The CFPB’s analysis of this credit card data found that:

• During the first half of 2023, small banks and credit unions tended to offer cheaper interest rates than the largest 25 credit card companies across all credit score tiers.
• The difference in reported Purchase Annual Percentage Rate (APR) between the largest and small issuers translated to average savings of $400 to $500 a year for a consumer with an average balance of $5,000 using a small bank or credit union’s card.
• Nearly half of the largest credit card issuers reported offering cards with a maximum purchase APR over 30 percent.
• Products offered by large issuers were three times as likely to include an annual fee than those at small institutions. The average size of annual fees for the largest issuers was approximately 70% higher than at small institutions.

The CFPB’s latest survey includes data on 643 credit cards from 156 issuers (84 banks and 72 credit unions) offered from January through June 2023. 430 cards were available nationally, while the remaining were only offered regionally or in a single state. The CFPB collected information on all general-purpose credit cards with the largest 25 credit card issuers in the U.S. as well as a representative sample of products from small and medium-sized banks and credit unions across the country. The information includes data on Purchase APR, which is the interest rate issuers charge on purchases when consumers carry a balance.

For more information about small issuers’ median APRs, median purchase APR by credit tier, credit card issuers’ pricing (over 30 percent), and lack of competition contributing to higher rates, click here.

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