Penalty APR (Annual Percentage Rate) is a higher interest rate that a credit card issuer may charge on a borrower’s outstanding balance if the borrower fails to make a required minimum payment or makes a late payment.

Penalty APRs are typically much higher than the standard interest rate and can vary depending on the credit card issuer and the borrower’s creditworthiness. The penalty APR can remain in effect for a certain period of time or indefinitely, depending on the credit card issuer’s policies.

Borrowers who are subject to a penalty APR may find it more difficult to pay off their balance due to the higher interest charges, which can result in a cycle of increasing debt. It is important for borrowers to understand the terms and conditions of their credit card agreements and to make payments on time in order to avoid triggering a penalty APR.