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‘If You Aren’t Able to Pay the Whole Thing Off There will be a Huge Cost’: Store Credit Cards Can Come With Astronomical Interest Rates

By Suzanne Woolley

 It’s tempting this time of year for shoppers to say yes to a store credit card that offers discounts on purchases. But those cards can come with astronomical interest rates.

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The cost of carrying a credit card balance has jumped as the Federal Reserve raises interest rates in an attempt to tame inflation, and store cards tend to charge more than most. The average annual percentage rate for retailer-brand credit cards stands at an all-time high of 26.72%, up from 24.35% in 2021, according to By comparison, the average APR for a general purpose card is 22.66%.

Some store cards with variable APRs have even breached 30%, including those from Wayfair, Bloomingdale’s, Macy’s, Shell, Exxon Mobil, QVC and the Home Shopping Network, according to LendingTree. 

Others have pared back APRs after they hit 30%. A card from Speedway was briefly above 30% before it was lowered to 27.74%, said Matt Schulz, chief credit analyst for LendingTree.

Despite rising interest costs, the US credit card delinquency rate remains low by historical standards. That’s giving card issuers room to keep raising APRs, Zhang said. 

‘Huge Cost’

Still, consumer balance sheets are starting to show a higher debt burden. Total US household debt swelled by $351 billion in the third quarter to $16.5 trillion, according to the Federal Reserve Bank of New York. Credit card balances rose 15%, the fastest annual rate in more than 20 years. 

Wei Zhang, the Consumer Financial Protection Bureau’s section chief for consumer credit, payments, cautions consumers to be especially careful with promotional offers to defer interest on a balance when you open a store card. If a consumer doesn’t pay off the entire balance within the promotional period, they may be hit with retroactive interest from the date of their purchase. 

“At the beginning it sounds like a very good deal, but if you somehow aren’t able to pay the whole thing off there will be a huge cost,” Zhang said.

Some store cards offer 5% cash back, which can be a better deal than what you’d get from a general-purpose credit card, said Ted Rossman, senior industry analyst at However, they’re only worthwhile for people who shop frequently at the retailer and know they won’t carry a balance.

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