Key Findings:
- Regular APRs rose 7.74% for secured credit cards and 3.10% for student credit cards relative to Q1 2012, while remaining largely unchanged for most other credit card segments – The most likely explanation for interest rates increasing for consumers with less established or damaged credit is a lack of competition among issuers for business in these segments.
- Foreign transaction fees fell 6.72% from Q1 2012 and 9.02% from the second quarter of 2011 and now average 2.22% – It’s a vicious cycle for issuers and a positive one for consumers – as more and more people realize the unnecessary expense posed by foreign fees, more credit card companies will slash these fees in hopes of garnering new business and other issuers will have to follow suit in order to keep up. We expect to see this trend continue moving forward.
- Not only is the average 0% introductory APR for new purchases being offered for 2.17% longer than last quarter and 19.71% longer than this time last year, but 0% balance transfer periods are also 1.99% and 38.04% longer than in Q1 2012 and Q2 2011, respectively – Offering long 0% introductory periods and lucrative initial rewards bonuses has become a new go-to strategy for credit card companies looking to attract consumers with excellent credit.
- Balance transfer fees are up 9.38% compared to Q2 2011 and 0.64% relative to last quarter – This represents the proverbial other shoe dropping in terms of the lengthening 0% balance transfer periods. Credit card companies are willing to offer low rates for longer, but they have to raise fees to compensate.
- The value of cash back initial rewards and those offered in terms of points or miles are headed in opposite directions: Points/miles bonuses are 7.32% more lucrative than last quarter and cash back bonuses are 2.11% less lucrative – Cash back initial bonuses have been slightly more lucrative than points/miles bonuses of late, and the changes in Q2 2012 establish more balance. Points/miles bonuses are also cheaper for credit card companies to offer given that cardholders tend not to get full value from them due to a failure to either redeem or redeem strategically.
- Data from Q1 2012 shows that the rate of credit card delinquency has decreased 20% since Q1 2011 and charge-offs are down 37.2% – Delinquency and charge-off statistics lag a quarter behind those related to rewards, interest rates, and fees, which is why data for Q2 2012 is not yet available. Nevertheless, the results from the first quarter of 2012 reveal an encouraging decrease in serious consumer credit card debt.
- The top 4 complaints represent nearly half (48.8%) of all the consumer complaints made in June 2012 – It’s no surprise that “Billing Disputes” tops the list, but it’s interesting that issues with one’s interest rate were more common than matters relating to identity theft and fraud. This perhaps speaks to the problems that people are having with out-of-control credit card debt.
Please find a breakdown of pertinent credit card data for Q2 2012 below, and check out our fun and useful infographic that puts a spotlight on the student credit card market:
Interest Rate Landscape
The table below summarizes average interest rates based on consumers’ credit standing.
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Excellent Credit | 12.95% | 12.98% | 12.72% | -0.23% | 1.81% |
| Good Credit | 17.12% | 17.12% | 16.66% | 0.00% | 2.76% |
| Fair Credit | 20.15% | 20.30% | 19.31% | -0.74% | 4.35% |
| Secured Credit Cards |
19.08% | 17.71% | 19.38% | 7.74% | -1.55% |
| Student Credit Cards |
16.30% | 15.81% | 15.94% | 3.10% | 2.26% |
| Business Credit Cards |
15.11% | 15.25% | 15.27% | -0.92% | 1.05% |
Balance Transfer Landscape
The table below summarizes key information for consumers interested in getting a credit card in order to transfer an existing credit card balance.
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Average Length of 0% APR Intro Period (in months) | 10.27 | 10.07 | 7.44 | 1.99% | 38.04% |
| Range of 0% APR Intro Periods (in months) |
6-18 | 6-18 | 6-21 | N/A | N/A |
| Average Regular APR for Cards that have 0% Intro APR on Balance Transfers |
16.55% | 16.59% | 16.39% | -0.24% | 0.98% |
| Range of Regular APRs for Cards that have 0% Intro APR on Balance Transfers | 8.15% – 25.99% | 8.15% – 25.99% | 7.24% – 24.99% | N/A | N/A |
| Average Balance Transfer Fee for Cards with 0% Intro APR on Balance Transfers |
3.15% | 3.13% | 2.88% | 0.64% | 9.38% |
Cards with the Longest 0% APR Intro Period for Balance Transfers:
Citi Diamond Preferred Card
Discover More Card – 18 Month Promotional Balance Transfer
Citi Simplicity Card
New Purchase Landscape
The table below summarizes key information for consumers interested in getting a credit card in order to make certain purchases they will not be able to pay back immediately (i.e. revolve a balance).
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Average Length of 0% Intro Period (in months) | 9.90 | 9.69 | 8.27 | 2.17% | 19.71% |
| Range of 0% APR Intro Periods (in months) |
4-18 | 6-18 | 6-21 | N/A | N/A |
| Average Regular APR for Cards that have 0% Intro APR on New Purchases |
16.30% | 16.33% | 16.34% | -0.18% | -0.24% |
| Range of Regular APRs for Cards that have 0% Intro APR on Purchases | 7.50% -25.99% | 7.50% -25.99% | 7.50% -24.90% | N/A | N/A |
Cards with the Longest 0% APR Intro Period for New Purchases:
Citi Diamond Preferred Card
Citi Simplicity Card
Rewards Landscape
The table below summarizes key information for consumers interested in rewards credit cards (i.e. consumers who use their credit card often and pay their balance in full every month).
Cash Back
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Average Base Earn Rate | 0.98 | 0.99 | 0.97 | -1.01% | 1.03% |
| Range of Base Earn Rate |
0.25% – 2% | 0.25% – 2% | 0.25% – 1.25% | N/A | N/A |
| Average Initial Bonus | $56.21 | $57.42 | $40.34 | -2.11% | 39.34% |
| Range of Initial Bonus | $10 – $250 | $10 – $250 | $10 – $250 | N/A | N/A |
Card with the High Initial Cash Back Bonus:
Ink Cash Business Card
Miles or Points
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Average Base Earn Rate (in miles or points) | 1.08 | 1.07 | 1.06 | 0.93% | 1.89% |
| Range of Base Earn Rate | 0.5 – 5 miles/points | 0.5 – 5 miles/points | 0.5 – 5 miles/points | N/A | N/A |
| Average Initial Bonus (in miles or points) | 10,787 | 10,051 | 8,924 | 7.32% | 20.87% |
| Range of Initial Bonus | 500 – 100,000 miles/points | 25 – 60,000 miles/points | 50 – 50,000 miles/Points | N/A | N/A |
Card with the High Initial Bonus for Points/Miles:
British Airways Credit Card
Fees
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Average Maximum Late Fee | $33.09 | $33.11 | $32.47 | -0.06% | 1.91% |
| Average Foreign Transaction Fee | 2.22% | 2.38% | 2.44% | -6.72% | -9.02% |
| Foreign Transaction Fee Range | 0% – 3% | 0% – 3% | 0% – 3% | N/A | N/A |
| Average Balance Transfer Fee for Cards with Intro Balance Transfer APR | 2.97% | 3.05% | 2.82% | -2.62% | 5.32% |
Penalty APRs
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Average | 28.51% | 28.53% | 27.90% | -0.07% | 2.19% |
| Range | 17.99% – 30.99% | 17.99% – 30.99% | 17.99% – 30.99% | N/A | N/A |
Cash Advances
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Average APR |
22.27% | 22.26% | 22.32% | 0.04% | 2.19% |
| APR Range |
6.25% – 49.90% | 6.25% – 49.90% | 6.25% – 49.90% | N/A | N/A |
| Average Cash Advance Fee % |
3.73% | 3.72% | 3.70% | 0.27% | 0.81% |
| Average Cash Advance Fee $ Amount |
$8.91 | $8.89 | $8.82 | 0.22% | 1.02% |
Credit Card Debt
| Q2 2012 | Q1 2012 | Q2 2011 | |
| Accumulation |
$17.71 billion | -$35.83 billion | $19.52 billiion |
| Percent Change from Previous Year |
N/A | 12% | 91% |
Delinquency and Charge-Off Data (Not Seasonally Adjusted)
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Delinquency Rate |
2.79% | 3.11% | 3.50% | -10.29% | -20.29% |
| Charge-Off | 4.24% | 4.37% | 5.58% | -2.97% | -24.01% |
Unemployment
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Unemployment Rate |
8.2% | 8.2% | 9.1% | 0.0% | -9.9% |
Popular Consumer Complaints (Percentage of All Complaints Filed)
| Q2 2012 | Q1 2012 | Q2 2011 | Change from Last Quarter | Change from Last Year | |
| Billing Disputes | 21.3% | N/A | N/A | N/A | N/A |
| APR or Interest Rate |
13.3% | N/A | N/A | N/A | N/A |
| Identity theft / Fraud / Embezzlement | 8.1% | N/A | N/A | N/A | N/A |
| Closing/Cancelling Account | 6.1% | N/A | N/A | N/A | N/A |
| Collection Practices | 5.0% | N/A | N/A | N/A | N/A |
| Credit Reporting |
5.0% | N/A | N/A | N/A | N/A |
| Credit Card Protection / Debt Protection | 4.3% | N/A | N/A | N/A | N/A |
| Credit Determination | 3.7% | N/A | N/A | N/A | N/A |
| Payoff Process | 3.1% | N/A | N/A | N/A | N/A |
| Late Fee |
3.1% | N/A | N/A | N/A | N/A |
The statistics displayed for Q2 2012 reflect consumer complaints made in June 2012, the only month for which data is available. As a result, no historical comparisons are yet available.
Notable Q2 2012 Credit Card Offers
- British Airways Credit Card – Offers an initial bonus of up to 100,000 miles – 50,000 after your first transaction, 25,000 when you charge $10,000 during the first year, and another 25,000 when spend $20,000 during that timeframe
- No Balance Transfer Fee Slate Card from Chase – Provides a 0% introductory APR on both purchases and balance transfers for 15 months and does not charge a balance transfer fee
- Consumers can no longer apply for the Orchard Bank Secured MasterCard, which was popular due to its 7.9% APR and no first-year annual fee, as well as other cards under the Orchard Bank brand name following Capital One’s acquisition of HSBC’s US credit card business, which Orchard Bank was a subsidiary of
Please find previous reports here:
This report was compiled using data from the 1000+ credit card offers that CardHub.com monitors on a daily basis.
For questions or more information regarding this report, please contact our media department.
