White House Clashes With Top Bank Chief On Credit Card 10% Cap

Trump is pushing a (so far voluntary) 10 percent cap on credit card APRs for one year, and the White House is publicly pressuring JPMorgan Chase CEO Jamie Dimon, who is warning the plan would be an “economic disaster” that slashes access to credit.

What Trump is proposing

• Trump has called on card issuers to cap credit card interest rates at 10 percent for one year and initially set an informal deadline of January 20, 2026 for banks to comply.

• He frames current APRs of roughly 20–30 percent as lenders having “ripped off” consumers and casts the cap as part of a broader affordability push heading into the 2026 midterms.

White House vs. Jamie Dimon

• The White House, via adviser Peter Navarro, singled out JPMorgan, telling Dimon to “lower your…credit card interest rates” and calling rates of 22–30 percent “criminal.”​

• Dimon, speaking in Davos, has warned that a 10 percent cap could cause “economic disaster,” with a drastic contraction of the credit card sector and cuts in access for a large share of Americans.

• Dimon is already in a separate legal dispute with Trump over alleged “debanking,” which is adding to the political edge of the clash.​

Status and implementation questions

• The January 20 date passed without major issuers voluntarily adopting a 10 percent cap, and analysts note Trump cannot impose such a cap unilaterally without legislation or regulatory action grounded in existing statutes.

• A coalition of five banking associations has argued that a 10 percent cap would reduce credit availability and hurt the very consumers it aims to help, signaling strong industry resistance and likely litigation if the administration tries to mandate it.

Interaction with late-fee / junk-fee policy

• Separately from interest rates, Trump’s administration has already moved in court to scrap the Biden‑era CFPB rule that would have capped most credit card late fees at 8 dollars, aligning with business groups that attacked the rule as unlawful.

• That creates a somewhat paradoxical posture: tougher rhetoric on interest rates, while working with industry to dismantle a binding consumer‑protective late‑fee cap put in place under Biden.

Market and political implications

• Bank and card‑issuer stocks have sold off on fears that even the threat of a cap signals a harsher pricing environment, while CFOs at large banks are openly warning that a 10 percent ceiling would force major changes to their business models.

• Consumer advocates are split: some on the left, including Senator Elizabeth Warren, welcome pressure on high APRs, but others argue that a blunt cap risks driving subprime borrowers to costlier or opaque credit products if mainstream card lines are cut.

Banks and card issuers are making five main arguments against the proposed 10 percent credit card APR cap.

1. Massive loss of credit access

• Trade groups (ABA, BPI, CBA, FSF, ICBA) argue a 10 percent cap would “reduce credit availability” and be “devastating” for millions of families and small businesses who rely on cards.

• Industry analyses cited by banks claim most accounts below roughly a 740 FICO would be closed or heavily restricted, implying 150–190 million Americans could lose card access or face sharply lower limits.

2. Harm to the consumers it aims to help

• Banks say constrained card lines will push higher‑risk and lower‑income borrowers toward less regulated and more expensive products such as payday loans and pawnshops.

• They frame this as a repeat of post‑Durbin dynamics, where fee caps on debit interchange led to cuts in rewards and certain checking account features, arguing that “unintended consequences” would land hardest on vulnerable borrowers.

3. Economic and financial‑stability risk

• JPMorgan CEO Jamie Dimon calls the cap an “economic disaster,” warning it could force a “drastic reduction of the credit card business” and “remove credit from 80 percent of Americans,” which banks say would weaken consumer spending.

• Bank CFOs and analysts add that an abrupt halving of APRs from near 20–30 percent to 10 percent would be a “seismic shift” in unsecured lending economics, with knock‑on effects for earnings, capital, and willingness to lend through the cycle.

4. Pricing vs. risk / business‑model viability

• Lenders argue that current APRs reflect risk‑based pricing of unsecured revolving credit, charge‑off rates, fraud, rewards, and funding costs, and that a flat 10 percent ceiling would make a large segment of accounts unprofitable.

• Industry groups say that to stay solvent under a 10 percent cap they would need to slash lines, tighten underwriting, raise annual fees, cut rewards, or exit segments entirely, which they present as evidence the policy is incompatible with the existing model.

5. Legal, implementation, and precedent concerns

• Banks note that Trump has not explained how a one‑year cap would be implemented, arguing that a binding ceiling would likely require congressional action and could face significant legal challenges.

• Trade associations also warn that once the federal government imposes a hard APR ceiling in one product, it sets a precedent for broader rate‑setting, which they see as a step toward more direct price controls in consumer finance.