US President Donald Trump’s proposal to limit credit card interest rates to 10% has drawn sharp criticism from banking leaders. JPMorgan Chase CEO Jamie Dimon called it an economic disaster, warning it would eliminate credit access for most Americans and damage restaurants, retailers, travel companies and schools.
Trump announced the interest rate cap on Truth Social earlier this month, setting an effective date of January 20, 2026, for a one-year duration. The proposal lacks details on implementation or legal enforceability. Current average credit card interest rates in the United States hover around 20 percent, making the 10 percent cap a significant reduction.
During remarks at the World Economic Forum in Davos, Dimon elaborated on his concerns. He stated that restricting rates to 10 percent would be drastically restrictive, cutting off approximately 80 percent of Americans from credit they depend on as backup financial resources. Dimon suggested trialling the policy in Vermont and Massachusetts, the home states of senators Bernie Sanders and Elizabeth Warren, who have backed similar proposals.
The banking industry broadly opposes the measure. US banking associations warn capping rates would be devastating for families and small businesses. Beyond credit card companies, Dimon emphasized that schools, municipalities, restaurants and retailers would suffer most when consumers cannot maintain their regular payments and expenses.
Trump doubled down on his position this week during an interview with CNBC, insisting that credit card companies earn substantial profits and should provide relief to consumers. The announcement sparked investor concern, causing share prices to decline for American Express, Visa, Mastercard and UK-based Barclays. The proposal revives an idea Trump championed during his 2024 campaign.
