The yearly cost of borrowing including certain fees, before compounding.
APR standardizes loan pricing so offers can be compared. It does not include compounding within the year — that’s APY’s job — so a card’s effective cost is slightly higher than its APR.
Example: A 24.99% APR card compounding daily costs an effective ~28.4% a year.
FAQ
What is APR in simple terms?
APR standardizes loan pricing so offers can be compared. It does not include compounding within the year — that’s APY’s job — so a card’s effective cost is slightly higher than its APR.