Annual interest rates on national merchants’ private-label credit cards are on the rise, suggest the results of a recent study from U.S. Rep. Anthony Weiner, D-N.Y.

Consumers need protection through clearer disclosure of merchants’ credit card terms at the point of sale, the congressman contends.

The average annual percentage rate for 35 credit cards is 23.83%, up 212 basis points from 21.71% in 2008, according to Weiner, who announced the study results Nov. 14. Weiner’s office conducted its research earlier this month by evaluating credit card offers for New York City residents found on the websites of major retailers and past data.

Radio Shack Corp., at 28.99%, had the highest interest rate among the store cards measured, followed by Staples Inc. and BBY Solutions Inc.’s Best Buy that offer cards with interest rates as high as 27.99%; Home Depot Inc. at 25.99%; and Sears Holdings Co.’s Sears card at 25.24%.

Store cards’ interest rates are substantially higher than bankcard rates, Weiner says. The average interest rate on a bankcard is 14.48%, according to, a website that monitors national credit card rate offers weekly.

The study also found that “teaser” rates on private-label credit cards are higher than those applied to bankcards. For example, the interest rate on Nordstrom Inc.’s credit card can rise to 23% from 11% if customers fail to make a minimum payment for 60 days; Target Corp.’s credit card rate rises to 23% from 13% under similar circumstances, according to the study.

Many private-label credit card programs offset their interest rates with promotional financing. The Home Depot is offering customers no interest on purchases if they pay off the balance within 18 months of the transaction.

But many customers fall prey to high interest rates that kick in when the promotion ends because the details are not disclosed prominently enough, Weiner contends

“Retailers promise big savings, ... but they’re doling out big bills on customers,” Weiner said in a statement, urging shoppers to “leave home without them” this holiday season.

Weiner last year introduced legislation to amend the Truth in Lending Act that would have required merchants to place signs at the point of sale to “conspicuously” display the terms of any credit and charge cards offered in the same way terms are disclosed on card applications. Legislators referred the bill to the House Financial Services Committee, where it stalled.

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