President Donald Trump has announced a one-year cap on credit card interest rates, limiting them to 10%. This move has sparked mixed reactions from lawmakers and the public alike. The restriction is set to take effect on January 20th, but the details of its implementation and enforcement remain unclear. Trump's social media post on Truth Social emphasized the intention to protect the American public from excessive credit card interest rates, which he claims reached 20 to 30% under the previous administration. However, critics argue that this cap may not be as effective as intended. During his campaign, Trump promised to address the rising credit card debt, which surpassed $1.17 trillion in the third quarter of 2024. Senators Bernie Sanders and Josh Hawley introduced a bipartisan bill in February 2025 to cap interest rates at 10% for five years, but it faced major opposition from banking groups and has yet to progress in Congress. Trump's announcement comes just one day after Sanders criticized him for not fulfilling his campaign pledge. Billionaire hedge fund manager Bill Ackman expressed skepticism, warning that capping rates could lead to credit card cancellations. Senator Elizabeth Warren also questioned the feasibility of implementing such a cap without congressional approval. The Bank Policy Institute, American Bankers Association, and other banking groups have opposed the cap, arguing that it may reduce credit availability and drive consumers towards less regulated alternatives. Despite the opposition, Senator Hawley praised the idea, indicating his support for the measure.
