An annual percentage rate (APR) represents the amount of interest owed or earned over an entire year including related charges but minus compound interest.
The term APR is widely used in the United States and the United Kingdom.
In Switzerland, effective annual interest rates are more widely used, and lenders are required by the Swiss consumer credit law to use these for personal loans and credit card loans. Effective annual interest rates account for interest, fees and charges, and compound interest.
See also: Annual percentage yield (APY)