Donald Trump has announced plans to make a major change to credit card interest rates in an effort to stop Americans from being “overcharged” by financial companies—though experts warn the proposal may not be as straightforward as it sounds.

Credit card interest rates in the US have surged in recent years. According to MacroTrends data, rates rose sharply between February 2022 and August 2023, climbing from about 16.17 percent to 22.7 percent. The increases continued into the following year, peaking above 23.37 percent. While rates have eased slightly since then, they were still sitting at roughly 22.3 percent as of November 2025.

In a recent post on Truth Social, Trump said he plans to impose a temporary cap on credit card interest rates, limiting them to 10 percent for a 12-month period. He argued that this move would prevent consumers from being “ripped off” by credit card companies.

What Trump has proposed

Trump wrote that Americans would no longer be exploited by credit card issuers charging interest rates between 20 and 30 percent—or higher—claiming these practices went unchecked under the Biden administration. He framed the proposal as a matter of affordability for everyday Americans.

According to Trump, the 10 percent cap would take effect on January 20, 2026, and would last for one year. He also noted that the date would coincide with the anniversary of what he described as a successful year of his administration.

This idea is not new. During his 2024 campaign, Trump made similar promises, telling voters that his administration would introduce a temporary limit on credit card interest rates to reduce financial strain.

Why the plan could have unintended consequences

Despite sounding consumer-friendly, banking and financial industry groups have raised serious concerns about the proposal. Several major organizations—including the Bank Policy Institute, the American Bankers Association, and the Consumer Bankers Association—issued a joint statement cautioning that a strict 10 percent cap could do more harm than good.

While they said they support efforts to make credit more affordable, the groups warned that such a low interest ceiling could significantly reduce access to credit. They argued that millions of families and small business owners who rely on credit cards could be negatively affected.

According to these organizations, banks might respond by tightening lending requirements, which would make it harder for people with lower credit scores or limited financial history to qualify for credit cards. They also warned that consumers could be pushed toward less regulated, higher-cost alternatives if traditional credit becomes harder to access.

In short, while a lower interest rate cap may sound appealing, critics say it could limit credit availability and create new financial challenges for the very people it is meant to help.