Will bank card rates of interest be capped at 10%? What we all know

The bank card business went into excessive gear over the weekend following a social media submit from President Donald Trump calling for a ten% cap on rates of interest. This mirrors a pledge he made on the marketing campaign path, and it additionally aligns with a pair of proposed payments in Congress (one within the Senate and the opposite within the Home) — although neither of those payments has seen any extra motion since being referred to the chambers’ respective committees in early 2025.

Whereas we now have extra questions than solutions proper now, this is what that you must learn about this growth.

Social media submit on Friday night time

The subject resurfaced with a Friday night time submit from President Trump on his Fact Social platform, which included the next:

“Efficient January 20, 2026, I, as President of the USA, am calling for a one yr cap on Credit score Card Curiosity Charges of 10%.”

The submit did not element the mechanics of implementing such a proposal, and no extra info has been shared as of the publication date. It is also a really compressed timeline for implementation, with lower than two weeks till the “efficient” date.

In remarks aboard Air Pressure One over the weekend, President Trump famous that card issuers would “be in violation of the regulation” in the event that they did not comply, although it stays to be seen what that truly means for issuing banks.

Whereas Federal Reserve knowledge reveals that American households are actually carrying roughly $1.23 trillion in bank card debt, many notice that an rate of interest cap would seemingly limit banks’ potential to lend, particularly to much less creditworthy people.

A joint assertion from banking business commerce teams famous the next:

“Proof reveals {that a} 10% rate of interest cap would scale back credit score availability and be devastating for thousands and thousands of American households and small enterprise house owners who depend on and worth their bank cards, the very shoppers this proposal intends to assist.”

One examine from the Digital Funds Coalition estimates that 82% to 88% of individuals (or about 175 to 190 million Individuals) may lose entry to credit score with the sort of cap.

TPG’s philosophy on rates of interest

One in all TPG’s core rules is to by no means carry a steadiness in your bank cards from one month to the subsequent. By paying each month-to-month assertion in full (and on time), you will keep away from curiosity prices fully. These charges can simply outweigh the worth of any rewards you may earn, so it is vital to spend inside your means in your playing cards.

That is why it is essential to know the ins and outs of credit score earlier than opening any new bank card product. You can begin with our newcomers information to bank cards after which dig deeper with the next tales to assist construct your information:

If you happen to do end up in bank card debt, there are a number of methods you may make use of to get again on observe. Chances are you’ll even be eligible for a steadiness switch card with one other financial institution. For a small payment, you might unlock a time period to pay down your steadiness with no curiosity.

Backside line

President Trump has renewed his requires a ten% cap on bank card rates of interest, a transfer that might have large implications for the bank card business and Individuals’ funds. Nonetheless, the complete particulars of how such a proposal would take impact stay to be seen.

Keep tuned to TPG, as we’ll have full protection of this subject as extra info turns into obtainable.