According to the Federal Reserve, on average, people pay between 19.65% and 21.5% in interest on credit cards
President Donald Trump’s insistence on a 10% one-year cap on credit card fees is attracting bipartisan interest but opposition from banks.
Trump posted on Truth Social last week that he intends to “no longer let the American Public be ripped off by Credit Card Companies that are charging Interest Rates of 20 to 30%.”
What to know
According to the Federal Reserve, average credit card interest rates currently range between 19.65% and 21.5%. The Consumer Financial Protection Bureau estimates that 195 million Americans held credit cards in 2024 and paid roughly $160 billion in interest.
While it remains unclear whether the cap would be implemented via executive action or legislation, the proposal is attracting interest in Congress, with ideologically diverse figures such as Senators Josh Hawley and Bernie Sanders backing similar measures.
Meanwhile, banking groups warn that a 10% cap could force lenders to tighten credit standards, limiting access for high-risk borrowers and pushing them toward costly alternatives such as payday loans.
Research from the Vanderbilt Policy Accelerator suggests that capping credit card fees could save consumers $100 billion annually while keeping the industry profitable through merchant fees.
With national credit card debt reaching a record $1.23 trillion, the debate highlights a growing tension between Trump’s economic policy and traditional banking.