This stands for the 'Annual Percentage Rate' of an interest charge. This is the true cost of borrowing funds with all the charges and hidden extras converted into an annual equivalent rate. These rates can then be compared on a uniform standard basis to determine the cheapest forms of finance.
A term to help protect the less financially astute! Many companies offering loan services concoct different definitions of interest rate - quoting weekly, monthly, annually, flat, compounded, straight, back ended... and so on. All designed to confuse. This is the one true comparable rate - the 'annual effective percentage rate including all hidden charges'.