Annual Percentage Rate (APR): It’s an annual percentage rate of interest a credit card holder will be charged on all or a portion of the balance if the full amount isn’t paid on or before the due date. This rate, however, is then divided by 365 days per year and then multiplied on the unpaid outstanding balance on a credit card daily, causing interest to compound on a daily basis.
Daily Periodic Rate (DPR): An interest rate calculated by dividing the annual percentage rate (APR) by either 360 or 365, depending on the card issuer. The resulting daily periodic interest rate is then used to calculate interest by multiplying the rate by the amount owed at the end of each day. This amount is then added to the previous day’s balance, which means that interest is compounding on a daily basis.