If your credit card interest rate goes up, the cost of any balance you carry from month to month goes up too. This article shows how much extra interest a rise could add.

ClearScore is a credit broker, not a lender.

Impact of Interest Rate Rise on Credit Card Payments

If you carry a balance from month to month, a higher interest rate means paying more interest. Credit card rates don't always move with the Bank of England's Bank Rate, but they can rise for that or other reasons.

If you're struggling with repayments, contact your card provider. Free debt advice is available from StepChange, National Debtline and Citizens Advice.

How much extra interest a rate rise could add

Total extra interest over the time it takes to clear the balance, if you make only the minimum payment (interest plus 1% of the balance, at least £5) and don't spend any more on the card. Starting rate 24.7%. Our calculation.

These figures assume cardholder makes only a minimum payment and no more.

Next Steps

Credit-builder cards usually charge higher rates than other cards, because lenders see their customers as a higher risk. Among ClearScore users approved for a credit card in early 2026, the median APR was 39.9% for scores up to 399 (see the chart below). The rate you're offered can fall as your credit score improves.

If you are carrying credit card balances from month to month, there are a range of approaches some people consider to manage the cost of that debt:

• Balance transfer cards: some credit cards offer a 0% interest period on balances transferred from other cards, which can allow borrowers to pay down the principal without accruing further interest during that period. The length of 0% deals and the fees involved vary between providers and depend on individual eligibility.

• Reducing non-essential spending: freeing up income by temporarily cutting discretionary expenditure is one way to accelerate debt repayment without taking on additional credit.

• Personal loans: some people consolidate credit card debt into a personal loan, which may offer a lower interest rate depending on individual credit profile and the loan terms available. This involves taking on a new credit agreement and the total cost will depend on factors like the rate offered, the loan term, and whether any fees apply.

The chart below illustrates how credit card and loan interest rates typically differ.

The rate you're offered depends on your circumstances, and a balance transfer or loan usually comes with fees. Eligibility and acceptance are decided by each lender and depend on its own criteria and checks. Checking your eligibility does not guarantee that you'll be accepted.

Always make sure you can afford repayments.

FAQs

Why did my credit card interest rate go up?

Not all card rates are linked to Bank Rate, and your provider can also change your rate for other reasons. It must tell you in advance, and you usually have the right to reject the increase, close the account and repay the balance at the old rate.

How to get my credit card interest rate lowered?

Some credit cards will lower the interest rate on your credit card if you manage your account well over time by always paying at least the minimum amount due on time and never exceeding the credit limit. You can always ask your credit card issuer if they will lower your rate.

Alternatively, you can look for a new credit card with a lower APR. The advertised representative APR only has to be offered to at least 51% of people who are accepted, so you could be offered a higher rate. Checking your eligibility first can show the rate you're likely to get without affecting your credit score.

The chart below illustrates how credit score and credit card APR are linked for typical ClearScore users:

What does interest rate mean for credit cards?

The interest rate on a credit card is basically the amount you'll be charged on balances that you don't pay back each month. It's payment to the credit card company for lending you the money.