US President Donald Trump has proposed a 10% ceiling on credit card interest rates, bringing a key campaign promise back to the policy forefront.

The cap is intended to take effect on 20 January, coinciding with the one-year anniversary of Trump’s return to the White House.

He emphasised on “affordability” as the reason for the move, which is said to remain in place for a year.  

“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 said in a post on his Truth Social platform.

However, he did not specify what legal mechanism the administration would use or how compliance would be enforced.

Trump had previously pledged such a cap during his second campaign.

Federal Reserve data show credit card balances exceeded $1.23tn at the end of September 2025, the fourth-largest category of household debt after mortgages, student loans and auto loans.

The new proposal drew immediate criticism from banking industry groups.

The Bank Policy Institute, American Bankers Association, Consumer Bankers Association, Financial Services Forum and Independent Community Bankers of America warned that a 10% ceiling would hurt borrowers.

In a joint statement, the groups said: “We share the President’s goal of helping Americans access more affordable credit. At the same time, evidence shows that a 10% interest rate cap would reduce credit availability and be devastating for millions of American families and small businesses who rely on and value their credit cards, the very consumers this proposal intends to help.

“If enacted, this cap would only drive consumers toward less regulated, more costly alternatives. We look forward to working with the administration to ensure Americans have access to the credit they need.”

Notably, the announcement follows Trump administration action last year to roll back a Biden-era rule capping most credit card late fees at $8.

Backed by business and banking groups, the administration argued in court that the rule was illegal, with a federal judge later striking it down.

A 10% cap is already the focus of pending legislation on Capitol Hill.

Senators Bernie Sanders and Josh Hawley introduced a bill in February 2025, followed in March by a House version co-sponsored by Representatives Ocasio-Cortez and Luna, reflecting a broader push to address rising consumer debt.

Both measures remain in committee and have yet to advance.