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Credit card interest rate cap legislation could move quickly in the new Congress, as Senator Elizabeth Warren said Sunday that she is ready to work with President Donald Trump on a 10% limit. A 10% credit card interest rate cap would sit far below current credit card interest rates, which averaged 22.36% in the third quarter of 2026, according to Federal Reserve data. Senate Democrats also take the majority in January, and supporters see the plan as credit card debt relief for millions of Americans.
How a 10% Credit Card Rate Cap Could Change Borrowing Costs
Warren, who is expected to chair the Senate Banking Committee once Senate Democrats take over, named the credit card interest rate cap as her first priority with Trump. She told CBS News’ Face the Nation:
“President Trump himself said that he wants to reduce interest rates on credit cards to 10 percent. I got the bill. I’m ready to go.”
Trump first called for a one-year 10% cap back in January, saying Americans were being “ripped off” by card companies. That January 20 deadline passed without any action.
Why The Senate Math Has Changed
Republicans controlled Congress then, and some of the strongest pushback came from Trump’s own party. Senate Majority Leader John Thune said the plan was “not something I’m out there advocating for,” and Senator Thom Tillis said he was “totally against” a 10% credit card interest rate cap.
Democrats now control both chambers, but Trump would still have to sign any bill.
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Banks Warn Of Tighter Credit And Higher Fees
The banking industry is right now the loudest opponent of a credit card interest rate cap, as banks use credit card interest rates to price risk. Sarah Grano, spokesperson for the American Bankers Association, said the group “continues to strongly oppose a government-imposed cap on credit card interest rates.” Lindsey Johnson, CEO of the Consumer Bankers Association, told Newsweek:
“But rather than addressing those underlying challenges, a 10% interest rate cap could restrict access to roughly 75% of current cardholders who rely on the product to navigate expense shocks and bridge the gap in times of need.”
JPMorgan Chase CEO Jamie Dimon also warned that a 10% cap could cause a drastic contraction in the card business.
What Borrowers Could Gain And Lose
For people carrying balances, a credit card interest rate cap could ease pressure fast. Monmouth University economics professor Robert H. Scott III said lower borrowing costs could help people pay down debt faster if the limit covered existing balances. Jennifer Doss, executive editor at CardRatings.com, told Newsweek:
“In the short term, a 10 percent cap sounds like a win for anyone carrying a balance at today’s 20 percent+ average interest rates. It’s immediate relief that puts money back in people’s pockets.”
That credit card debt relief could come at a cost, though, as Doss also warned of “hangover effects” like tighter credit, lower limits, higher fees and fewer rewards.
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Democrats also see credit card debt relief as a test of Trump’s populist promises. Trump had vowed to become “Mr. Veto” if Democrats won Congress, but at the time of writing he has signaled openness to deals with them.