What percentage-based figure expresses a credit card's yearly borrowing cost, including certain fees?

The percentage-based figure expressing a credit card’s yearly borrowing cost is the annual percentage rate, or APR.

APR is intended to make borrowing costs easier to compare by expressing interest and certain charges as an annualized percentage. On a credit card, the purchase APR is only one possible rate: an account may also list separate APRs for cash advances, balance transfers, and penalty pricing. The card agreement explains how those rates apply.

Credit-card issuers commonly calculate interest using a periodic rate derived from the APR, often a daily periodic rate. The actual finance charge depends on factors such as the balance, the number of days in the billing cycle, and the issuer’s calculation method. Paying a statement balance in full can avoid purchase interest when the account offers a grace period, but it does not automatically erase every type of charge.

APR should not be confused with a card’s annual fee. The fee is a fixed account charge, while APR describes a rate applied to borrowing under specified conditions.