President Trump made headlines by demanding credit card companies lower rates to 10% – or else. But here’s what the news doesn’t tell you: He can’t really make this happen without Congress, and the banks know it.
On January 9, 2026, Trump posted on Truth Social: “Effective January 20, 2026, I, as President of the United States, am advocating an annual cap on credit card interest rates of 10%.” He added that credit card companies have “really abused the public” and claimed they would be “breaking the law” if they don’t follow the rules.
There’s just one problem: such a law does not exist.
The legal reality
According to Brian Shearer, director of competition and regulatory policy at the Vanderbilt Policy Accelerator, “He can’t do this through legal executive action. But there are bipartisan bills in the House and Senate that he and his allies could push.”
Senator Elizabeth Warren was also unimpressed, noting that “begging credit card companies to be nice is a joke” — especially as the government works to curtail the CFPB, the agency designed to protect consumers from predatory lending practices.
The numbers that matter
$1.31 tonsTotal outstanding revolving credit
13.9%Average rate in 2015
According to the The Federal Reserve’s G.19 reportcredit card interest rates have risen dramatically over the past decade. The current average of 22.3% is almost double what it was ten years ago.
What’s actually in Congress?
There IS a bipartisan bill – the 10 percent credit card interest cap law (S.381)-introduced by Senator Bernie Sanders (I-VT) and co-sponsored by Senator Josh Hawley (R-MO). It would temporarily cap interest rates at 10% for five years.
The bill hasn’t gone anywhere. According to GovTrack, it only has an 11% chance of making it past committee and a 9% chance of becoming law.
The banking sector’s response
Banks do not simply take this to heart. The Bank Policy Institute warned that a 10% cap would be “devastating” for consumers and “drive consumers to less regulated, more expensive alternatives.”
Is this true? Partially. When you limit the interest rate, lenders tighten the credit terms. But here’s what the banks don’t want to tell you: if you pay 22% interest on credit card debt, you are not building wealth, you are transferring it to shareholders.
What this means for you
Let me be direct: Don’t wait for politicians to solve your debt problem.
Whether or not this rate cap ever happens (spoiler: probably not), there are options available TODAY:
✓ Actions you can take now
- Balance transfer to a 0% intro APR card (if your credit allows)
- Debt consolidation loan at a lower fixed interest rate
- Credit advice for a debt management plan (typically 6-8% interest)
- Debt settlement (negotiate directly or through a company)
- Bankruptcy (often the fastest way to a new start)
✗ What doesn’t help
- Waiting for government action that may never come
- Pay minimums in the hope that interest rates will drop
- Taking on more debt to pay off existing debt
- Paying out pension to pay off credit cards
Not sure which option suits your situation? Take my Find Your Path quiz for personalized guidance based on your specific circumstances.
The bottom line
Key Takeaways
- Trump’s January 20 10% interest rate cap ‘deadline’ has no legal force without congressional action
- The current average credit card rate is 22.3%, compared to 13.9% a decade ago
- Bipartisan legislation exists, but it has little chance of passing
- Banks will fight any interest rate cap, claiming it will limit access to credit
- Your best move: Take action NOW to pay off your debts instead of waiting for political solutions
Debt is math, not morality. The math says that 22% interest means you’re working for the credit card company, not yourself.–Steve Rhode
If you have high-interest credit card debt, the question isn’t whether the government will help you. The question is: what are YOU going to do about it?
… (Source: NPR) | (G.19 data from the Federal Reserve)
Frequently asked questions
Can President Trump actually cap credit card interest rates at 10%?
No. The president cannot set credit card interest rates by executive order. Congress should pass legislation to allow for an interest rate cap. Several laws, including the Consumer Financial Protection Act, Truth in Lending Act and CARD Act, would need to be changed.
What is the current average credit card interest rate?
According to the Federal Reserve’s November 2025 G.19 report, the average credit card interest rate for interest-rated accounts is 22.30%. This is almost double the average rate of 13.9% from 2015.
Is there actual legislation in Congress to cap credit card rates?
Yes. The 10 percent Credit Card Interest Rate Cap Act (S.381) was introduced by Senators Bernie Sanders and Josh Hawley. However, the bill has not yet made it out of committee and has only about a 9% chance of becoming law, according to GovTrack’s analysis.
What should I do if I’m struggling with high-interest credit card debt?
Don’t wait for government action. Discover your options now: balance transfer cards, debt consolidation loans, credit counseling, debt settlement or bankruptcy. Each option has pros and cons depending on your situation. Take the Find Your Path quiz at GetOutOfDebt.org for personalized guidance.
Would a 10% rate cap actually help consumers?
It’s complicated. While lower rates would save money for current cardholders, banks warn they will tighten credit standards, potentially eliminating access to credit for more than fourteen million households. However, if you pay 22% interest, you are transferring wealth to shareholders instead of building your own financial future.
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