President Donald Trump on Friday referred to as for a one-year cap on bank card rates of interest at 10%, efficient Jan. 20, with out specifying particulars.
“Please be told that we’ll not let the American Public be ‘ripped off’ by Credit score Card Corporations which can be charging Curiosity Charges of 20 to 30%, and much more, which festered unimpeded in the course of the Sleepy Joe Biden Administration. AFFORDABILITY!” he wrote on social media.
It’s not clear whether or not bank card corporations will reply to his name, or what actions he would possibly take to power any change.
The put up comes because the Trump administration intensifies efforts to exhibit to voters that the president is addressing issues about prices and costs which have emerged as a central challenge within the November midterm elections.
Throughout the 2024 presidential marketing campaign, Trump pledged to hunt limits on the curiosity bank card corporations can cost.
Hours earlier than his message on Friday, Senator Bernie Sanders, a Vermont impartial, mentioned on X: “Trump promised to cap bank card rates of interest at 10% and cease Wall Road from getting away with homicide. As an alternative, he deregulated massive banks charging as much as 30% curiosity on bank cards.”
In a letter final yr to Sanders and Senator Josh Hawley, a Missouri Republican, a gaggle of banking commerce teams painted a dire consequence for shoppers if the federal government ever capped rates of interest on bank cards at 10%, because the senators had proposed.
“Many shoppers who at the moment depend on bank cards can be compelled to show elsewhere for short-term financing wants, together with pawn retailers, auto title lenders or worse — corresponding to mortgage sharks, unregulated on-line lenders and the black market,” the group wrote.
The Financial institution Coverage Institute mentioned in a report final yr that “whereas the proposed cap is a well-intentioned effort to scale back the excessive debt burden some households are dealing with, it will hurt shoppers’ entry to card credit score.” The group additionally mentioned such a transfer may power card issuers to scale back cardholder advantages, together with profitable rewards tied to purchases.
Responding to Trump’s put up on Friday, Hawley mentioned on X: “Implausible thought. Can’t wait to vote for this.”
