Today, Senators Bernie Sanders and Josh Hawley introduced a bill to limit credit card interest rates to 10 percent for five years. The American Financial Services Association (AFSA), representing credit card issuers, opposes the proposed cap.
The AFSA expressed its concerns in the New York Times, describing rate caps as “unworkable” and stating they “actually harm the consumers policymakers are trying to help, by limiting the types of credit tens of millions of Americans depend on more than ever.”
The organization argues that capping late fees misunderstands their role in the market. According to AFSA, late fees deter late payments which can negatively impact consumers' credit scores and future access to credit. These fees also allow financial institutions to manage risk effectively. Without them, institutions might increase prices generally or restrict rewards programs and credit availability.
AFSA is actively informing its members about this issue and does not expect widespread Republican support for the legislation. Although President Trump has indicated potential support for a temporary cap on credit card fees, Treasury Secretary Bessent did not take a definitive stance during his confirmation hearing but stated he would align with the president's policy decision.