In a surprising move on January 10, 2026, President Donald Trump took to social media to propose a one-year cap on credit card interest rates at 10%, set to take effect from January 20, 2026. This announcement aims to protect consumers from what Trump describes as the predatory rates often exceeding 20% to 30% commonly charged by credit card companies.
While the proposal could offer immediate relief to millions of Americans burdened by high interest rates, Trump did not specify how this cap would be implemented or whether it requires congressional approval to take effect. Observers noted that a similar pledge was made during his 2024 presidential campaign, suggesting that such a sweeping move would face significant legislative hurdles.
The reaction from major credit card issuers—such as American Express, Capital One, JPMorgan, Citigroup, and Bank of America—has been muted, as these institutions did not respond to requests for comment regarding the potential voluntary reduction of rates. This silence leaves many to wonder whether financial giants are prepared to comply with a lower cap.
Congressional Reaction: Perspectives from Both Sides
The response from Congress to Trump’s proposal has been predictably polarized. Senator Elizabeth Warren, a prominent Democrat on the Senate Banking Committee, criticized the call as ineffective without concrete legislation backing it. She emphasized the need for real policy changes rather than simplified statements devoid of actionable steps.
Republican Senator Josh Hawley expressed his support for Trump’s proposal, having previously co-sponsored bipartisan legislation with Senator Bernie Sanders aimed at capping credit card rates at 10% for five years. This bipartisan effort underscores a growing recognition among some lawmakers of the burden high interest rates place on consumers.
Efforts in the House haven’t been any different, where Representative Alexandria Ocasio-Cortez and Republican Congresswoman Anna Paulina Luna have also introduced legislation with similar aims. Nonetheless, the Republican-controlled Congress may complicate the path toward any meaningful reform.
Industry Concerns: The Banking Sector Speaks Out
The banking sector has rallied against Trump’s proposal, with five major banking trade groups—including the Consumer Bankers Association and the American Bankers Association—issuing a joint statement warning that a cap at 10% would significantly decrease access to credit for consumers. They cautioned that consumers might be driven towards less regulated alternatives, such as pawn shops and unregulated lenders, further complicating the financial landscape.
The Bank Policy Institute added that limiting interest rates would necessitate a reduction in cardholder benefits, including rewards programs that many consumers have come to rely on as part of their credit card usage.
Adding to the skepticism around Trump’s proposal, billionaire fund manager Bill Ackman, a supporter of Trump’s 2024 campaign, labeled the move a “mistake” in a social media post. This criticism from a prominent financial figure highlights the complex implications of such a sweeping financial policy.
A Broader Context: Regulatory Shifts and Future Implications
Recently, the Trump administration sought to eliminate a Biden-era rule that capped credit card late fees at $8, a move that reflects the contentious and evolving regulatory landscape surrounding consumer financial protections. As debates about interest rates and credit accessibility continue, the future of consumer credit may be shaped by both new proposals and the existing regulatory framework.
As the January 20th deadline approaches, all eyes will be on Congress and the financial industry to see how they respond to Trump’s call for change, marking what could be a pivotal moment for consumer credit in America.
