Donald Trump, the Republican candidate for president, said on Wednesday that he would cap credit card interest rates. However, a seasoned expert says that the plan won’t get the support it needs in Congress to become a reality.
Author Ian Katz, who works for Capital Alpha Partners and studies financial companies IYG -0.38%, told BourseWatch in an email, “I don’t see a way for that to happen in Congress.”
Trump said in a campaign speech in Uniondale, New York, on Wednesday, “We’re going to temporarily cap credit card interest rates while working Americans catch up.” It will be capped at about 10%. They can’t make 25% and 30%. He didn’t say anything else about the promise. Instead, the former president criticized worries about climate change.
There have been similar ideas in the past from politicians like Sen. Josh Hawley (R-MO) and Sen. Bernie Sanders (I-VT), who is an independent but usually votes with the Democrats. Those steps haven’t gained enough support to become law.
Last year, Hawley’s bill for a cap of 18% was met with skepticism. At the time, analysts at TD Cowen Washington Research Group said that they “did not see a path for it to pass either the Senate or the House given what it could mean for credit availability.” When they said this, the analysts meant that credit card companies might serve fewer people if there was a cap.
Katz from Capital Alpha said Thursday that credit card companies would probably get stricter about who they give cards to, which was a similar point.
