A bipartisan bill to cap credit card interest rates at 10 percent has been introduced in both chambers of the 119th Congress but has gone nowhere. The Senate version, S. 381, was filed on February 4, 2025, by Senators Bernie Sanders and Josh Hawley. The House companion, H.R. 1944, was filed on March 6, 2025, by Representatives Alexandria Ocasio-Cortez and Anna Paulina Luna.1Congress.gov. S.381 – 10 Percent Credit Card Interest Rate Cap Act2GovInfo. H.R. 1944 – 10 Percent Credit Card Interest Rate Cap Act Both bills sit in committee. Neither has had a hearing, a markup, or a floor vote.
What the Cap Would Actually Do
The bill amends the Truth in Lending Act to set a hard ceiling of 10 percent on the annual percentage rate for credit card extensions of credit, and that ceiling is inclusive of all finance charges. To keep issuers from routing charges around the cap, the bill provides that fees not technically classified as finance charges cannot exceed the total finance charges assessed on the account.3GovTrack. S. 381 – Full Text
The penalty is stiff. A creditor that knowingly charges above 10 percent forfeits all interest on the obligation, and a borrower has two years from the last usurious collection to sue for everything paid in interest, finance charges, or fees.3GovTrack. S. 381 – Full Text
The cap would sunset on January 1, 2031, giving the policy roughly a six-year run. The bill preserves any state consumer-protection law that goes further than the federal cap.3GovTrack. S. 381 – Full Text
Who Introduced It, and Why
The sponsorships cross party lines by design. Sanders, an independent democratic socialist from Vermont, paired with Hawley, a Republican populist from Missouri. In the House, Ocasio-Cortez, a progressive Democrat from New York, paired with Luna, a Republican from Florida.4Senator Bernie Sanders. Sanders, Hawley Introduce Bill Capping Credit Card Interest Rates at 10%5Office of Rep. Ocasio-Cortez. Ocasio-Cortez, Luna Introduce Bill to Cap Credit Card Interest Rates at 10% Senators Kirsten Gillibrand and Jeff Merkley signed on as cosponsors.6Nolo. Can President Trump Legally Cap Credit Card Interest Rates at 10%?
All four lead sponsors framed the bill as delivering on a campaign pledge by President Trump to cap credit card rates at 10 percent. Sanders called rates above 25 percent “extortion and loan sharking.”4Senator Bernie Sanders. Sanders, Hawley Introduce Bill Capping Credit Card Interest Rates at 10% Luna said credit card companies “have abused working class Americans with absurd interest rates, trapping them in an almost insurmountable amount of debt.”7Office of Rep. Luna. Reps. Luna, Ocasio-Cortez Introduce Bipartisan Bill to Cap Credit Card Interest Rates at Ten Percent
The Case Supporters Are Making
Card rates today sit far above the proposed ceiling. The average interest rate on accounts assessed interest was about 21 percent as of November 2025, according to Federal Reserve data.8Federal Reserve Economic Data. Commercial Bank Interest Rate on Credit Card Plans, All Accounts The CFPB’s 2025 biennial report put the average APR on general-purpose cards higher still, at 25.2 percent at the end of 2024, the highest level the bureau has recorded since at least 2015. Total credit card debt topped $1.2 trillion, and consumers paid $160 billion in interest in 2024, up from $105 billion two years earlier.9Consumer Financial Protection Bureau. The Consumer Credit Card Market 2025
Supporters point to the spread between bank funding costs and cardholder rates. When the bill was introduced, the federal funds rate stood at 4.25 percent, meaning banks were charging cardholders roughly six times their own cost of borrowing.10Norwood News. Ocasio-Cortez Introduces Bipartisan Bill to Cap Credit Card Interest Rates at 10%
A September 2025 analysis by the Vanderbilt Policy Accelerator, drawing on Federal Reserve data covering more than 330 million individual accounts, estimated that a 10 percent cap would save consumers about $100 billion a year, or an average of $899 per person. The study reported that credit card industry return on assets during the period studied ran roughly five to six times higher than that of a typical bank. Even a looser 15 percent cap, the researchers found, would save $48 billion annually with minimal effect on rewards or lending volume.11Vanderbilt Policy Accelerator. Capping Credit Card Rates12Vanderbilt Law School. Bipartisan Credit Card Proposals Could Save Billions
Why Banks and GOP Leaders Are Fighting It
The financial industry has pushed back hard. The American Bankers Association, joined by state banking groups, wrote to Senate leaders in May 2025 opposing any attempt to attach the cap to other legislation, arguing that a 10 percent ceiling would restrict or eliminate credit access for individuals and small businesses.13American Bankers Association. Letter to Congress Opposing 10 Percent Credit Card Interest Rate Cap
The Bank Policy Institute estimated in a May 2025 research note that at least two-thirds of cardholders who carry revolving balances, roughly 14.3 to 15.1 million U.S. families, would face reduced or eliminated credit lines under the cap. The BPI said the impact would land hardest on borrowers with imperfect credit histories, who rely on cards as backup liquidity and to rebuild scores through repayment.14Bank Policy Institute. The Potential Adverse Consequences of a Credit Card Interest Rate Cap
Industry groups also predicted that banks would recover lost interest revenue through other channels: cutting rewards, ending zero-interest promotions, adding annual fees, raising minimum monthly payments, and increasing balance-transfer and cash-advance fees.14Bank Policy Institute. The Potential Adverse Consequences of a Credit Card Interest Rate Cap The Electronic Payments Coalition claimed 190 million Americans could lose credit access entirely.15Americans for Tax Reform. Price Controls
Republican leaders in Congress have echoed those concerns. House Speaker Mike Johnson said rate caps would cause card companies to stop lending and lower borrowing limits, and Senate Majority Leader John Thune said the policy would “deprive an awful lot of people of access to credit.”15Americans for Tax Reform. Price Controls
Opponents cite Illinois. After the state imposed a 36 percent all-in cap on loans under $40,000 in March 2021, unsecured installment loans to subprime borrowers dropped 44 percent, according to research shared by the American Financial Services Association. Banks and credit unions, exempt from the cap, added a net 571 loans, offsetting a small fraction of the roughly 20,800-loan decline from other lenders. In a follow-up survey, nearly 40 percent of affected borrowers reported that their financial well-being had declined after the cap took effect; only 11 percent said it improved.16American Financial Services Association. Effects of Illinois’ 36% Interest Rate Cap on Small-Dollar Credit Availability and Financial Well-Being
Where the Bill Stands in Congress
S. 381 was referred to the Senate Banking, Housing, and Urban Affairs Committee, chaired by Tim Scott of South Carolina, who has signaled opposition to price controls on credit. H.R. 1944 went to the House Financial Services Committee, chaired by French Hill of Arkansas, another skeptic of rate caps.17Congress.gov. S.381 – All Info18R Street Institute. Both Ends of the Ideological Spectrum Get It Wrong With Credit Card Interest Rate Caps
The only serious floor moment came in May 2025, when Hawley tried to attach the cap as an amendment to the GENIUS Act, a stablecoin regulation bill. The ABA and allied trade groups mobilized against it, and the amendment was not included. The GENIUS Act cleared the Senate 68-30 on June 17, 2025, without the rate cap.19America’s Credit Unions. GENIUS Act Clears Senate Without Interchange, Credit Card Rate Cap Amendments
Can Trump Cap Rates Without Congress?
President Trump said during his campaign and after taking office that he wanted credit card rates capped at 10 percent, with an effective date of January 20, 2026. That date passed without any cap being implemented.20NPR. Trump Credit Card Interest Rate Cap
Legal analysts have generally concluded that the president cannot impose a cap on his own. Setting consumer interest rates is a legislative function, and the Supreme Court’s 1952 decision in Youngstown Sheet and Tube Co. v. Sawyer holds that presidential power must come from the Constitution or an act of Congress. Neither grants rate-setting authority over consumer credit. The CFPB has not been given that authority either.6Nolo. Can President Trump Legally Cap Credit Card Interest Rates at 10%?
In April 2026, Senator Elizabeth Warren wrote to the Federal Reserve, the FDIC, and the OCC asking why none had taken action to enforce what she called the president’s “purported” cap. According to Warren, Americans were still paying average card rates of roughly 25 percent months after Trump’s stated deadline.21Senate Banking Committee Minority. Warren Questions Banking Regulators on Lack of Progress
Why Rates Got This High in the First Place
Federal efforts to limit credit card rates have a long, mostly unsuccessful history. Before the late 1970s, most states capped credit card rates around 18 percent under their own usury laws. The Supreme Court’s unanimous 1978 ruling in Marquette National Bank v. First of Omaha Service Corp. changed that by holding that a nationally chartered bank could charge the rate allowed by the state where it is headquartered, regardless of where the cardholder lives. Citibank moved its card operations to South Dakota in 1980 to take advantage. By 2003, about 75 percent of U.S. credit card loans originated from states, principally South Dakota and Delaware, that contained only 4 percent of the population.22Legal History Jotwell. The Rise of Credit Cards and the Fall of the New Deal Order
That framework still governs. There is no general federal cap on credit card rates. Existing federal limits reach only narrow populations: the Military Lending Act caps rates at 36 percent for active-duty servicemembers and their dependents, and federal credit unions are generally limited to 15 percent APR. Congress passed the CARD Act in 2009, which improved pricing transparency and restricted certain practices, but it did not cap rates.23Congressional Research Service. Credit Card Interest Rate Caps24Consumer Financial Protection Bureau. CFPB Bans Excessive Credit Card Late Fees With the committee chairs overseeing banking policy both skeptical of rate controls and the CFPB in a deregulatory posture, the 10 percent cap has no obvious route forward.