President Trump warns credit card companies ahead of January interest rate cap of 10%
President Trump said credit card companies would be in violation of the law if they do not comply with the 10% interest rate cap by January 20th.
President Donald Trump has asked credit card companies to cap interest rates at 10%, about half the industry average, starting Jan. 20.
That day has arrived, and credit card interest rates have remained largely unchanged.
what happened?
In a Jan. 9 post on Truth Social, President Trump said, “We will no longer allow the American people to be ‘ripped off’ by credit card companies that charge 20-30% or higher interest rates.” He called for card interest rates to be capped at 10% for one year from January 20, his first anniversary in office.
The credit card industry did not follow suit. Banks and consumer experts said they were unaware of any major credit card companies that followed President Trump’s directive.
“I haven’t seen any press releases,” said Stephen Cates, a financial analyst at Bankrate. “There wasn’t a single whisper.”
Are you waiting for your card rate to drop? Don’t hold your breath.
This may be unwelcome news for credit card customers who were hoping to see their interest rates cut in half after the Martin Luther King Jr. holiday.
“If you’re someone who’s looking at your bill and waiting for 8 p.m. to 10 p.m., I’m not going to hold your breath,” Cates said.
President Trump hasn’t walked back his message on card fees. In a public comment on January 12, he said card companies that do not comply with the 10% cap would be “breaking the law.”
But card companies are hearing a different message from other voices in Washington, including Republican leaders and members of the Trump administration.
In any case, consumer experts say President Trump does not have the authority to mandate interest rate caps on credit cards, a policy measure that would require a vote in Congress.
“Changes like this can’t happen with just a tweet,” said Adam Last, director of financial services at the Consumer Federation of America.
House Speaker Mike Johnson, Republican of Louisiana, told reporters on January 13 that President Trump’s cap could have “negative side effects,” including crowding out borrowers with low credit scores.
A few days later, National Economic Council Chairman Kevin Hassett shifted his focus from interest rate caps to the “trump card” banks can offer to people with weak credit.
Credit card companies ignored President Trump’s interest rate cap.
These comments and others suggest banks may be able to ignore the 10% cap, banking industry and consumer experts said.
“Not only are they ignoring it, but they’re apparently being told by the most senior economic policy officials in the Trump administration to ignore it,” said Mike Pearce, executive director of the consumer debt nonprofit Protect Borrowers.
The banking industry reacted violently to President Trump’s cap. In response to his post on Truth Social, several industry groups issued a joint statement saying the cap would be “devastating for millions of American families and small businesses who rely on and value credit cards, and for the very consumers this proposal seeks to help.”
This is not the first time President Trump has campaigned against high credit card interest rates.
President Trump said during his 2024 campaign that he would cap interest rates at 10%. After his reelection, the cap was included in a bipartisan bill sponsored by Sen. Bernie Sanders (R-Vt.) and Josh Hawley (R-Missouri).
“Working Americans are drowning in record credit card debt while the biggest credit card issuers raise interest rates to the limit and get richer,” Hawley said in a statement at the time.
However, the bill stalled due to strong opposition from the credit card industry.
American credit card usage: $1.2 trillion
As of the third quarter of 2025, Americans will have $1.2 trillion in credit card debt, according to federal data. According to LendingTree’s analysis, this tab has risen 60% in four years.
Banking industry leaders say the increase in balances speaks to the growth in the number of credit card customers.
“This growth largely reflects expanded access to credit, especially for those who can afford it, and we are seeing those borrowers manage their debt responsibly,” said Lindsey Johnson, CEO of the Consumer Bankers Association.
Credit card interest rates average around 19.6%, not far below record highs, according to Bankrate.
Card companies argue that the 10% cap jeopardizes the ability of consumers with poor credit to obtain a credit card. Millions of low-income and economically vulnerable households could lose access to cards or have their credit limits significantly reduced.
“This is not a one-size-fits-all experience for consumers,” Johnson said.
According to one industry study, a 10% cap would close the credit card market to people with credit scores below 740, which equates to 175 million to 190 million Americans.
Still, Consumers Federation of America’s Rust applauded President Trump for proposing the cap, just for bringing the issue into the national conversation.
“The good thing that comes from this is that people become more aware of how much they are spending on credit card debt,” he said.
This story has been updated to add new information.
