MW Trump says he'll cap credit-card interest rates at 10% as Americans battle soaring debt
By Leslie Albrecht and Angela Moore
Carrying credit-card debt has become increasingly expensive over the past several years, but some warn that lower interest rates could reduce credit access
President Donald Trump said in a social-media post Friday that he would cap credit-card interest rates at 10% for the next year.
President Donald Trump says he's keeping a campaign promise to make carrying credit-card debt cheaper for Americans, writing in a social-media post Friday night that he would cap interest rates on credit cards at 10% for one year.
Credit-card interest rates range between 17.69% for someone with "excellent" credit to as high as 35.99% for someone with "poor" credit, according to SoFi.
"We will no longer let the American Public be 'ripped off' by Credit Card Companies that are charging interest rates of 20 to 30% and even more," Trump said in a Truth Social post. He said the cap would go into effect on Jan. 20.
The president didn't say how the interest-rate cut would happen and it could require Congress to pass legislation. It was unclear whether he would attempt to force this change on financial companies.
The move is the latest attempt by Trump to address Americans' affordability concerns as households face mounting costs for a range of expenses including insurance premiums, heating bills and cars. Earlier this week he said he was planning to ban "large institutional investors" from buying single-family homes, describing the move as one that would address spiraling housing costs. At the same time, the Trump administration has rolled back consumer protections, including a rule that would have kept medical debt from appearing on people's credit reports.
Read: Why Trump banning institutional investors from buying homes won't bring down housing costs
Carrying credit-card debt has become increasingly expensive over the past several years. The average APR, or annual percentage rate, on a new credit card is 23.79%, according to LendingTree (TREE).
Credit quality Effective interest rate
Excellent (740 and above) 17.69%
Good (a score of 670-739) 23.84%
Fair (a score of 580-669) 27.37%
Poor (a score of 300-579) Up to 35.99%
SoFi Learn
"Americans paid more than $160 billion in credit-card interest charges in 2024 - a 50% jump since 2022," the borrower advocacy group Protect Borrowers wrote in a blog post this week, citing a new report from the Consumer Financial Protection Bureau.
Collectively, Americans owed $1.23 trillion on their credit cards in aggregate as of the end of the third quarter of 2025, up $24 billion from the previous quarter, according to data from the Federal Reserve Bank of New York. The average credit-card debt for people with unpaid balances was $7,886 in the third quarter, LendingTree said.
Trump isn't the first politician to call for a cap on credit-card interest rates. Sen. Bernie Sanders of Vermont and Sen. Josh Hawley of Missouri introduced a bill in 2025 to curb credit-card APRs at 10% for five years. Sanders, an independent who caucuses with Democrats, compared the interest rates that card issuers charge consumers to "extortion and loan sharking," and Hawley, a Republican, called them "exploitative."
The Consumer Bankers Association said Sanders and Hawley's proposal would backfire and prevent Americans from accessing credit. "Price-setting is political pandering that has, time and time again, proven to harm Americans," the trade group told MarketWatch in 2025. "These socialist-type pricing policies are the best way to drive up costs for consumers and push access to credit further out of reach for millions of consumers."
Bill Ackman, the high-profile billionaire hedge-fund manager, responded to Trump's post, calling it "a mistake." He said that the move would pressure credit-card companies to cancel millions of credit-card accounts and that consumers would "turn to loan sharks for credit at rates [higher] than and on terms inferior to what they previously paid."
The Electronic Payments Coalition, a payments-industry trade group, cited a study it conducted with the Missouri Bankers Association that found that a 10% cap on interest rates would mean that up to 88% of open credit-card accounts could lose credit access "including nearly every account associated with a credit score below 740."
"Respected economists have reiterated this warning and emphasized these caps might sound promising, but are bad policy and create unintended consequences," Executive Chairman Richard Hunt said in a statement on Friday.
But Matt Schulz, LendingTree's chief consumer finance analyst, told MarketWatch on Friday that his firm's 2024 survey found majority support for such a rule, even with its required trade-offs.
Despite the potential for "a dramatic reduction in credit-card rewards," as well as curtailed lending access, LendingTree Chief Consumer Finance Analyst Matt Schulz told MarketWatch on Friday that "it is also clear that most Americans are willing to accept both of those consequences if it means capping interest rates."
A 2024 LendingTree survey showed "that two-thirds of cardholders support a credit-card rate cap, even if it means reduced rewards, and in six in 10 support it even if it means restricted access to credit for many," he added.
Emily Bary contributed reporting
-Leslie Albrecht -Angela Moore
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January 09, 2026 23:40 ET (04:40 GMT)
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