Trump's Credit Card Rate Proposal: What a 10% Cap Could Mean for the Financial Sector

Lowering Interest Rates on Credit Cards Takes Center Stage in Trump’s Economic Push

Former President Donald Trump announced Friday through Truth Social his commitment to pursuing legislative action on lowering interest rates on credit cards, specifically targeting a maximum 10% rate for a one-year period. This initiative represents Trump’s latest effort to challenge the financial services industry amid broader corporate accountability measures.

“Credit card companies have been exploiting Americans with unconscionable rates between 20% and 30%, a situation that remained unchecked throughout the Biden years,” Trump wrote in his statement. “Beginning January 20, 2026, I will work toward establishing a one-year 10% ceiling on credit card interest rates to protect hardworking families.”

The date holds significance as it marks one year into Trump’s second term as president.

The Legislative Reality: Why Presidential Action Alone Won’t Work

While Trump’s proposal has generated headlines, the political mechanics tell a more complex story. Any cap on interest rates would require Congressional approval—the president cannot unilaterally impose such financial regulations. Previous legislative attempts targeting similar measures have stalled in Congress, raising questions about the practical feasibility of this initiative.

The White House has not provided additional commentary on implementation details or legislative strategy for this proposal.

Banking Industry Pushback: Concerns About Market Consequences

Major financial institutions swiftly responded to Trump’s announcement. Chase and Citi representatives pointed to a coordinated statement from prominent banking associations including the Bank Policy Institute, American Bankers Association, Consumer Bankers Association, Financial Services Forum, and Independent Community Bankers of America.

The banking sector’s position directly contradicts Trump’s framing: “While we support efforts toward making credit more accessible, research demonstrates that a 10% interest rate ceiling would paradoxically restrict credit availability and potentially damage millions of households and small enterprises relying on credit products. Such restrictions may divert consumers toward alternative lending markets that operate with less regulatory oversight and carry higher costs.”

This argument—that strict rate caps could shrink credit availability rather than improve it—reflects longstanding industry doctrine on pricing regulation.

Political Momentum: Sanders’ Challenge Precedes Trump’s Announcement

Senator Bernie Sanders amplified pressure on Trump just before the Truth Social statement. On X, Sanders criticized Trump for failing to deliver on his 2024 campaign promise regarding lowering interest rates on credit cards while simultaneously rolling back banking regulations.

“Trump promised to cap credit card rates at 10% and challenge Wall Street,” Sanders posted. “Instead, he’s removed safeguards on major banks, letting rates hit 30%. Meanwhile, JPMorgan CEO Jamie Dimon pulled in $770 million last year. That’s fundamentally wrong.”

This criticism contextualizes Trump’s announcement as a direct political response to progressive pressure.

Broader Context: A Week of Corporate-Focused Actions

The credit card proposal sits within a wider pattern of Trump administration activities targeting large corporations and financial markets. Earlier this week, Trump directed officials to acquire $200 billion in mortgage bonds—an intervention ostensibly designed to reduce mortgage rates and monthly housing costs for consumers.

Trump simultaneously announced restrictions preventing large institutional investors from acquiring single-family residential properties and issued an executive order capping spending commitments by major defense contractors.

Regulatory Reductions Signal Contradictory Direction

Complicating the narrative around consumer protection, the Trump administration simultaneously reduced funding for the Consumer Financial Protection Bureau—the federal watchdog responsible for monitoring financial market fairness and competition.

This policy shift stands in tension with the stated commitment to lowering interest rates on credit cards, suggesting competing priorities within the administration’s financial approach.

What Happens Next?

The actual impact of Trump’s proposal depends entirely on Congressional action. While the announcement demonstrates political commitment to the issue, historical precedent suggests significant obstacles to passage. The banking industry’s organized opposition, combined with economic arguments about market consequences, will likely determine whether this proposal advances beyond the announcement phase.

The debate over balancing consumer protection against financial sector stability continues to define the intersection of politics and economic policy.