Why Trump has warned credit card companies of 'severe' consequences
What's the story
US President Donald Trump has warned credit card companies of dire consequences if they do not comply with his proposed 10% cap on interest rates by January 20. Speaking to reporters, Trump said that failure to implement the cap would put these companies in violation of the law. He stressed that he wants a cap on credit card interest rates as some are as high as 30%.
Public awareness
Trump emphasizes public unawareness of high interest rates
Trump further emphasized that many Americans are unaware of the high credit card interest rates. "The people out there are working, and they have no idea that they're paying 30%," he said. He accused credit card companies of abusing the public and vowed not to let it continue. However, legal and financial experts have said such a move would require new legislation from Congress to take effect.
Policy proposal
Trump's credit card interest rate cap announcement
On Friday, Trump announced a one-year cap on credit card interest rates in a post on Truth Social. He said firms must charge a maximum of 10% and that the new rates would take effect from January 20. The announcement comes as the US is preparing for its midterm election. Trump has warned his Republican aides about potential impeachment if they lose.
Post
Trump blames Joe Biden
In his Truth Social post, Trump wrote, "Please be informed that we will no longer let the American Public be 'ripped off' by Credit Card Companies that are charging Interest Rates of 20 to 30%, and even more." He blamed the Joe Biden administration for allowing this situation to persist. The banking industry has opposed Trump's proposal, saying it would drive consumers toward less regulated and more costly alternatives.