The U.S. banking industry has presented a united front against Donald Trump’s proposed 10% cap on credit card interest rates. In a rare joint statement, organizations including the American Bankers Association, the Consumer Bankers Association, and the Bank Policy Institute condemned the move. They warned that the policy, set to begin on January 20, would have “devastating” consequences for American families and small businesses.
The statement outlines the industry’s core economic argument: interest rates are necessary to cover the risk of lending. If rates are capped at 10%, banks cannot afford to lend to borrowers with lower credit scores or higher risk profiles. The groups predicted that this would lead to a massive contraction in credit availability, forcing consumers toward less regulated and more expensive alternatives.
Trump’s announcement, made on Truth Social, framed the cap as a way to stop the “ripping off” of the public. He cited the record $1.17 trillion in credit card debt as justification for the intervention. The banks, however, argue that they are being scapegoated for broader economic issues like inflation.
Senator Elizabeth Warren also criticized the announcement, calling it a “joke” without legislative approval. She argued that Trump is ignoring the complexity of the financial system and offering a slogan rather than a solution. Warren challenged the administration to work with Congress on real reform.
Despite the unified opposition from the financial sector, the move has been praised by Senator Josh Hawley. The clash between the banking lobby and the populist political movement is set to define the economic debate in the coming weeks.