An annual rate that is never charged annually
APR stands for annual percentage rate, which suggests a charge applied once a year. On a credit card it never is. The issuer divides the APR by 365 to get a daily periodic rate, applies that to your balance every single day, and bills the total at the end of the cycle.
A 24.99% APR is therefore a daily rate of about 0.0685%. On a $1,000 balance that is roughly 68 cents a day, around $20.50 in a thirty-day cycle. The arithmetic is unremarkable; the consequence is not, because that interest is added to the balance and the next day's interest is calculated on the new, larger figure. The rate compounds.
Compounding is why the effective annual cost of carrying a balance is higher than the stated APR. At 24.99% compounded daily, a balance carried untouched for a year grows by about 28.4%, not 24.99%.
Which balance is it applied to
Nearly every US card uses the average daily balance method, usually including new purchases. The issuer records your balance at the end of each day in the cycle, averages those figures, and applies the periodic rate to the average. This is why paying something mid-cycle reduces the interest charge even if it does not clear the balance, and why a large purchase late in the cycle costs less interest in that cycle than the same purchase made on day one.
A handful of agreements use two-cycle or adjusted-balance methods. The agreement names the method it uses.
When the APR does not matter
If you pay your statement balance in full every month, you will not be charged purchase interest regardless of whether the rate is 11% or 31%. The grace period covers you, and the APR is a number you never encounter. For someone who always pays in full, comparing cards on APR is comparing on a figure that will never be applied to them — the annual fee and the foreign transaction fee are the real costs.
Two exceptions survive paying in full. Cash advances have no grace period on almost every card, so interest accrues from the moment of the transaction. And if you carry a balance into one cycle, most cards suspend the grace period on new purchases until you clear the whole balance again, so the rate reaches purchases you would have expected to be covered.
Ranges, and why you may not get the good end
Most agreements disclose a range — 18.24% to 28.24% is typical. Where you fall in it is set at approval, from your credit profile, and the agreement does not say how. Comparing the bottom of one card's range against the bottom of another's assumes you would be offered the best rate on both, which is not something either document promises.
Where a filing discloses a range, this site shows the whole range rather than the flattering end of it. Where it discloses one rate, we show the one rate.
Fixed is rarer than it sounds
A variable APR moves with an index, almost always the US Prime Rate. A fixed APR does not move with an index — but it is not fixed in the sense of being guaranteed. Under the CARD Act an issuer can still change a fixed rate on future balances with 45 days' notice. "Fixed" means "not automatically indexed", not "will not change".
Variable rates and the Prime Rate covers what the indexed version exposes you to.
Next
To see how the rate on a particular card compares with the rest of the database, find it through the full agreement index or its issuer. For the fees that apply whatever the rate is, see the fees, one by one.