What They Are Saying

"Reflecting on the proposed 10 percent interest rate cap, the authors write that “the motivation for such caps seems to derive from the perception that credit card interest rates are too far above the cost of funds to be competitive,” but “spreads exceeding default probabilities by a large margin can easily arise in a competitive credit card market.” They show that, if faced with a 10 percent interest rate cap, lenders would significantly reduce credit limits for high-risk borrowers, making the policy “welfare-reducing” for this group."

“Using household-level data from a major credit bureau, we find that loan balances for the riskiest borrowers declined substantially relative to counterparts in states without caps. Despite taking on less debt, these borrowers did not experience an improvement in delinquencies.”

“While the government certainly has a role to play, Congress’s proposal to cap credit card interest rates at 10%–while seemingly a boon for Tennessee consumers–would, in reality, implement artificial price controls. Such controls frequently lead to unintended and detrimental economic consequences. A credit card is essentially an unsecured loan, which means that rates are determined in part by assessing risk – primarily the risk of lending to someone without significant assets to back the loan. It’s this ability to price for these very real-world risks that allows financial institutions the flexibility to extend credit to a new entrepreneur or a working family trying to rebuild their credit score.” – Holly Duren

“Rate caps will mean fewer Americans with low incomes or poor credit scores have access to credit cards, leaving them worse off, not better off.”

“Some may think that low-income people and families will gain the most from a cap on interest rates since they will pay less in interest. In reality, they will lose as banks recall or stop issuing cards to high-risk and low-income customers.”

“History offers a clear lesson. When access to credit is constrained, capital flows toward those who already have wealth, assets, and established banking relationships. That is how we ended up with a system that once excluded so many aspiring entrepreneurs. Rolling back access today risks recreating those same barriers.” – Eric Kearney

“Price controls reduce access and harm the very people they're meant to help. A 10% credit card rate cap would eliminate access for nearly 9 out of 10 cardholders with lower credit scores.”

“Big affordability ideas are getting headlines — but the details matter. A 10% credit card APR cap and 50-year mortgages sound helpful, yet both have unintended consequences. Lower payments don’t always mean lower costs. Skepticism is healthy.”

“The proposed APR cap could therefore prompt lenders to reduce credit limits or stop issuing new cards to borrowers they view as too risky or too expensive to serve under the cap…Consumers, especially those with low credit scores, could turn to less regulated, high-cost alternatives, including some buy-now-pay-later products or payday-style loan products that fall outside traditional consumer protections. If that happens, a policy intended to shield consumers from high interest costs could unintentionally push them toward products with fewer safeguards, less transparency, and higher costs.” – Breno Braga and Thea Garon

“Capping credit-card interest rates would cause more consumers, especially low-income consumers, to lose access to credit…More government interference in the free market is the wrong way to address cost-of-living concerns. If Republicans can’t figure that out between now and November, they deserve to lose.”

“In recent months, the Trump administration has moved to address the affordability crisis through changes to major financial systems, including an executive order seeking to ban institutional investors from owning single-family homes, lowering mortgage rates for homebuyers, and reducing credit card interest rates. Alternative assets continue to face scrutiny as the White House reviews a rule that could pave the way for greater inclusion of private equity and other alternative investments in 401(k) plans. Private credit is under increased pressure from regulators and investors following the public collapse of several private credit firms last year.” – Rogé Karma

“For our nation’s small businesses already operating on thin margins, restricted credit access can be ruinous. It can mean delaying expansion, forgoing new hires, missing a payroll, or closing altogether. At a time when entrepreneurs are already navigating inflation, workforce shortages, and economic uncertainty, limiting their financial tools is not consumer protection. It is economic sabotage…Credit rate caps are especially consequential for both low and moderate-income communities and Hispanic entrepreneurs…There are smarter ways to support consumers and small businesses without undermining access to critical financial tools. Transparency, financial education, competition, and innovation can all help lower costs while preserving choice. Blunt instruments like rate caps, however, threaten to choke off opportunity at a time when our economy needs entrepreneurship more than ever.” – Javier Palomarez

“For Hispanic entrepreneurs, many of whom are first-generation business owners, immigrants, or sole proprietors, this risk is especially acute. These entrepreneurs often rely on personal credit cards or small lines of credit to launch and sustain their businesses. If lenders are no longer able to price risk appropriately, they will not extend credit to applicants with thin credit profiles. This goes to show that a policy designed to lower costs could instead eliminate access altogether…The ripple effects extend beyond business owners themselves. Consumers also rely on credit to manage everyday expenses, especially during economic uncertainty. When consumers lose access to credit, spending declines.” – Julio Fuentes

“A temporary cap wouldn’t necessarily provide dramatic relief for most cardholders. If interest rates were capped at 10% and applied to existing balances, a borrower carrying the average balance of $1,734 would save about $20 in interest charges that month. Any cap on credit-card pricing might accelerate a shift among some credit-card issuers toward targeting higher-income customers. Higher-end customers tend to generate more fee revenue and pose less credit risk.”

“A 10% credit card interest cap sounds like a good idea. But it’s not a discount, it’s a delete button…”

“When these hundreds of thousands of families stop spending money because the credit card company drops them, it is going to severely hurt the economic growth path that America is on, playing right into the gloomy predictions of the mainstream media and radical left. Because less loans means less market activity and a less healthy economy. The consequences would be especially severe for working families.” – Lynn Westmoreland

“The most likely unintended consequence of capping credit card debt is decreased consumer spending, said Stephen Miller, the research director at UNLV’s Center for Business and Economic Research…and he pointed out that one of the things keeping the American economy afloat right now is consumer spending…‘The problem is, some banks would stop issuing credit cards because they’re not going to make money, they are going to lose money. So the downside is the amount of credit card debt would be reduced and that would reduce consumption and have effects on GDP.’” – Stephen Miller

“A 10% cap on credit card interest rates sounds like help for consumers, but it's price control that would slash credit access for up to 90% of cardholders, raise fees, kill rewards, and push working families toward riskier, unregulated lenders.”

“I got a real problem with price controls…There’s a lot of Democrats — you know, most favored nation status, 10% credit card caps, credit card competition act — those are all Democrat priorities. And if the president embraces them, he may have more Democrats voting for the Republicans.” – Punchbowl News

“The straightforward implication is that a price cap would limit the supply of credit to users. Issuers would reduce credit limits and withdraw cards from riskier or poorer borrowers. In many cases, those consumers would then turn to buy-now-pay-later schemes or borrow from less regulated creditors, such as payday lenders and pawnshops…The administration’s preoccupation with “affordability” is welcome, but there are far better ways to address the problem.”

“In terms of the interest-rate cap, there will be unintended consequences as it relates to points. It almost seems like points are secondary when it comes to the effects that could wreak havoc on the economy. There are estimates that almost 80% of Americans would see a drastic reduction in their credit lines. A 10% interest rate is just not profitable for banks, and they would not lend unprofitably. People would then be spending less, and that would significantly impact the economy…This is all said to be for affordability for consumers, but the fact of the matter is consumers will lose the ability to spend and to earn points.” – Brian Kelly

“‘As a pure state intervention into private credit markets, Trump’s move functions as a government price control. History repeatedly shows that price controls don’t protect consumers...’ - Yaël Ossowski”

“Basic economics remains undefeated. When the government mandates prices below market reality, supply dries up. That will happen for credit cards, too. [Yael Ossowski] explains in @TheHillOpinion”

“‘People with bad credit who are rebuilding and using subprime cards, they’re going to lose those cards…Their journey of rehabilitating their credit is going to stop. And consumers who are new to credit, who have lower credit scores, simply because they’ve never had credit, this is going to make it harder for them to get cards’…He said an interest-rate cap could also cut into the perks that many credit card holders cherish, since lenders use the money they generate from interest payments to help fund things such as access to airport lounges and cash-back benefits. – John Ulzheimer

“Price controls on credit card interest rates may sound populist, but decades of evidence show they reduce access to credit, especially for lower-income and higher-risk borrowers.” – Vance Ginn

“Unsurprisingly, Maxine Waters does not understand that interest rate caps threaten consumer credit and would worsen affordability for millions of Americans.”

“The people hit first by a 10% cap would not be Wall Street executives or wealthy households with pristine credit. They would be working- and middle-class people. Research shows that even a 15% interest-rate ceiling would threaten access to credit for roughly 95% of people with credit scores below 700. Another analysis found that a 10% cap could eliminate or sharply curtail credit access for more than 14 million people nationwide.” – Bay Buchanan

"I appreciate that President Trump is seeking to lower costs, but capping credit card interest rates to 10% would hurt more people than it would help. It could impact many Americans' ability to build credit history, finance a car, rent an apartment, & buy a home.”

“The same logic applies to interest rates, which are prices as well. They reflect borrower risk, the availability of substitute or complementary credit products, and banks’ own input costs such as labor, technology, risk-monitoring, and regulatory compliance. Trying to cap an interest rate is an attempt to ignore the economic information and forces that prices convey.”

"Capping rates at 10% would inevitably force issuers to slash rewards and curtail credit... A paper by the Philadelphia Fed concluded the 2009 law 'likely had an adverse effect on non-prime borrowers.'"