President Trump has made a bold, public move to combat what he terms the “banking cartel,” announcing a plan to cap credit card interest rates at 10% for one year, starting on January 20, 2026. This proposal targets the current rates, which often exceed 20% and can reach over 30% for high-risk borrowers, as part of his broader “AFFORDABILITY” initiative. The banking industry has immediately mobilized against the cap, warning it will severely limit credit availability, while critics point out that the proposal will require Congressional action to be implemented.
Story Highlights
- Trump announces one-year 10% cap on credit card rates starting January 20, 2026.
- Current rates exceed 20% average, reaching mid-30s for subprime borrowers.
- Banking industry warns cap would devastate credit availability for millions.
- Implementation requires Congressional action, not presidential decree.
Trump Takes Aim at Credit Card Exploitation
President Trump announced Friday on Truth Social his plan to cap credit card interest rates at 10% for one year beginning January 20, 2026. The proposal targets credit card companies charging Americans 20-30% interest rates, which Trump characterized as “ripping off” the American public. This announcement comes as part of his broader “AFFORDABILITY” initiative aimed at reducing household debt burdens that have crushed working families under the previous administration’s inflationary policies.
The timing proves significant, as Sanders publicly criticized Trump hours before the announcement for failing to deliver on his 2024 campaign promise of a 10% credit card cap. Trump’s response demonstrates his commitment to fighting for American consumers against Wall Street’s predatory lending practices that have become normalized under decades of regulatory capture.
Trump just announced a credit card interest cap of 10% effective January 20th pic.twitter.com/ZfTqUGklch
— Sippi Cup (@sippicup2) January 10, 2026
Banking Industry Mobilizes Against Consumer Relief
Major banking trade associations immediately condemned Trump’s proposal, with the Bank Policy Institute, American Bankers Association, and Consumer Bankers Association issuing joint statements warning of “devastating” consequences. These groups claim a 10% cap would reduce credit availability for over 14 million households, forcing consumers toward payday lenders and unregulated alternatives. Their predictable response reveals how dependent the banking sector has become on extracting usurious profits from American families struggling with basic expenses.
America’s Credit Unions CEO Scott Simpson argued that capping rates at 10% makes credit “unattainable for millions,” essentially admitting that current business models rely on exploitative interest rates to remain profitable. The Electronic Payments Coalition warned against “one-size-fits-all” regulations, defending a system where excellent credit borrowers pay 17-18% while subprime borrowers face rates exceeding 30% – a spread that enriches banks while impoverishing consumers.
Congressional Action Required for Implementation
Trump’s announcement lacks immediate implementation mechanisms, as presidents cannot unilaterally impose credit card interest rate caps without Congressional approval. The existing “10 Percent Credit Card Interest Rate Cap Act” (S.381) in the 119th Congress provides a potential legislative pathway, though previous efforts have stalled due to intense banking industry lobbying. This reality underscores the uphill battle against entrenched financial interests that profit from keeping Americans trapped in debt cycles.
The proposal’s one-year timeframe and symbolic start date of January 20, 2026 – Trump’s second inauguration anniversary – demonstrates strategic political timing. This approach allows Congressional Republicans to champion consumer protection while building momentum for broader financial reforms that prioritize American families over Wall Street profits.
Watch the report: 10% cap announced: Trump puts his foot down for high interest rates
Sources:
- Trump Calls for One-Year Cap on Credit Card Interest Rates at 10% Starting January 2026
- Trump calls for a one-year 10% cap on credit card interest in a Truth Social post
- Visa (V) Stock: Trump’s 10% Credit Card Rate Cap Proposal Creates Uncertainty for Payment Networks
- Trump urges credit card companies to slash interest rates to 10% for one year
