With the average shopper expected to spend roughly $890 this holiday season, store credit cards charging interest at a rate of 33.07%, and 52% of people unaware of how “deferred interest” works, WalletHub today released its 2025 Deferred Interest Study and its annual Store Credit Card Landscape Report to help people get the most out of retailer financing offers.
Here are some highlights from WalletHub’s research:
- Financing Crime: 51% of Americans think it should be illegal for retailers to use deferred interest.
- Major Retailers Still Offer Deferred Interest: Best Buy, Home Depot, Dell and JCPenney, among others.
- Far Too Common: 80% of store credit cards with 0% intro APRs use deferred interest.
- Shoppers Shift to BNPL: 50% of people prefer buy now, pay later installment loans to 0% financing with deferred interest.
- Know Before You Owe: More than half of Americans have agreed to a special financing offer without being sure they can handle the monthly payments.
- Misleading Offers Backfire: Nearly 9 in 10 people say they would stop shopping at a retailer if it had a misleading financing offer and ended up charging them a lot of interest.
- First-Purchase Discount: The average store card with an initial discount for new cardholders gives 19.51% off.
- Average 0% Intro Period: The average store credit card with a 0% intro APR is interest-free for 19 months.
“Store credit cards are a double-edged sword for holiday shoppers. On the one hand, store cards can help you save an average of nearly 20% on your first purchase, plus up to 5% back moving forward. They can also help you finance big purchases when your credit isn’t good enough to qualify for a general-purpose credit card with a 0% introductory APR. On the other hand, 0% retailer financing offers typically come with ‘deferred interest,’ which can lead to 27.5 times more interest charges than a normal card. The key to avoiding a costly surprise is to ensure your balance is down to zero at least a month before your 0% financing expires. You can accomplish that by making a budget that allows you to pay off your balance on schedule, then diligently stick to it. If you’re careful, a store card can be a holiday asset rather than a liability.”
- John Kiernan, WalletHub Editor
More From WalletHub
- Best Store Credit Cards
- Best Credit Cards for Holiday Shopping
- Best Gift Cards
- Best Credit Cards for Purchase Protection
- Best Credit Cards for Price Protection
- Holiday Shopping Survey
- Best 0% APR Credit Cards
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