On Jan. 9, President Donald Trump announced on Truth Social his support for a temporary 10% cap on credit card interest rates, posting, “We will no longer let the American public be ‘ripped off’ by credit card companies that are charging interest rates of 20 to 30%.” This was a proposal Trump also made during his 2024 presidential campaign as an effort to improve affordability for consumers.
Although Trump set a Jan. 20 implementation date for the proposal, the plan did not come to fruition. On Jan. 21, at the World Economic Forum in Davos, Switzerland, Trump then urged Congress to pass legislation that would cap credit card interest rates.
Bankers hoped to fend off the president’s request, with JPMorgan Chase CEO Jamie Dimon considering the move “an economic disaster” that, in the worst case, you’d have "a drastic reduction of the credit card business” for 80% of Americans, he said.
Others disagree. Brian Shearer, director of competition and regulatory policy at the Vanderbilt Policy Accelerator, considers the plan a “good idea” in an op-ed to The Hill, saying “you wouldn’t think it if you’ve been paying attention to the pundits.” He also cited polling that shows 88% of Democrats, 79% of Republicans and 78% of independents support capping credit card interest. Progressive Democrats like Sens. Bernie Sanders and Elizabeth Warren support legislation to cap credit card interest rates.
Along with the push to cap credit card interest rates is an effort to cap credit card late fees, dropping them to as low as $8 from as high as $30 to 40. Bankers also challenged this proposal back in 2024, when the Consumer Financial Protection Bureau finalized a rule bringing fees down to $8, before a federal judge threw out the rule.
We discuss the pros and cons of these credit card proposals and explore how both lawmakers and bankers, in different ways, say they want to put affordability at the forefront.
GUESTS:
Aaron Klein, Miriam K. Carliner Chair and senior fellow in economic studies at the Brookings Institution
Matthew Metzgar, economics professor at UNC Charlotte
Mike Pierce, executive director and co-founder of Protect Borrowers (formerly the Student Borrower Protection Center)
