Plastic is fantastic at Wachovia's rate.

• Position: Wachovia Bank of North Carolina N.A.'s lower interest rates on credit cards

If you build a better mousetrap, the world will burn up your 800 lines. The most recent must-have: Wachovia's credit cards charging an annual percentage rate below 10%. The rate on the bank's Prime Plus Visa and Master Card plunged to 9.4% in January.

A month later, the bank was still being deluged with thousands of inquiries a day about the cards and had "hundreds of millions of dollars" outstanding on issued cards, according to Jerry Craft, Wachovia's top credit-card executive.

The cards, with a rate pegged at 2.9% above the prime lending rate, were first offered in April 1991 at 11.9%, but the rate followed the prime's downward slide. "It seems as though when you break 10% there's a lot more interest," Craft says. For customers who carry a balance, savings can be substantial: On a $2,000 balance, the annual charge with a Wachovia card would be $188. On a card with a rate of 19.8%, the levy would be $396.

Can Wachovia make money at these rock-bottom rates? "They are absolutely not loss leaders," Craft says. Annual...