Washington-Seng. Bernie Sanders, I-Vt. , and Josh Hawley, R-Mo. The bill was introduced on Tuesday It caps credit card interest rates at 10% – an effort by two lawmakers who rarely make eye contact.
Credit card interest rates refer to the fees that charge the card issuer if the consumer does not repay the credit card balance in full by a certain date. The average credit card interest rate is over 20%. According to Bankrate data.
Sanders and Holy bills come after President Donald Trump vowed in 2024 Competition to temporarily cap credit card interest 10% rate.
“If a large financial institution charges interest of more than 25% on a credit card, they are not engaged in a business that makes credit available,” Sanders said in a statement. “They are engaged in horror and loan stocks. We cannot continue to allow big banks to make huge profits that rip the people of America.”
Holy said the bill is “an easy way to provide meaningful relief to working people.”
The law will remain in effect for five years. According to the press release.
The proposal could face scrutiny among lobbyists in the banking and credit card industry. American Financial Services Association, the national trade association for the consumer credit industry; Discussed in the September statement That rate cap is “infeasible” and relies on Americans who “actually try to help consumer policymakers by limiting the type of credit.”
“We fully support professional consumer policies that provide consumers with more choice and flexibility for their finances, but credit product fee caps are required by American consumers. It's not a solution,” they write.
Credit card debt among Americans is increasing every year. In the third quarter of 2024, the country's credit card balance reached $1.17 trillion.
