Trump urges Congress to enact 10% credit card interest rate cap
President Donald Trump on Wednesday urged U.S. lawmakers to pass legislation that would cap credit card interest rates at 10 percent, after ordering banks to voluntarily lower interest rates in a social media post this month.
Speaking at the World Economic Forum in Davos, Switzerland, Trump said, “I am asking Congress to cap credit card interest rates at 10 percent for one year, and this will help millions of Americans save for a home.”
“They are charging Americans 28%, 30%, 31%, 32% interest rates,” Trump said. “What happened to usury?”
Following the announcements, bank stocks rose.
Of the options the Trump administration has to pressure American banks on card rates, legislation may be less threatening. A bill was introduced last year by Sen. Josh Hawley of Missouri and Sen. Bernie Sanders of Vermont that would cap card APRs at 10% for five years; The bill was stopped in Congress.
Analysts including KBW’s Sanjay Sakhrani said it was unlikely a card bill would have enough bipartisan support to become law. Republican lawmakers, including House Speaker Mike Johnson expressed his attention When it comes to card price controls.
KBW Bank index It was up 2% in morning trading. Capital One, which relies on cards for most of its revenue, rose 1.8%.
Several major credit card issuers contacted by CNBC on Tuesday said they would not make any changes to interest rates but declined to say they all oppose Trump’s proposal.
This story is developing. Please check back for updates.
