Trump's proposed credit card interest rate cap could curb access for millions of Americans: report

Core Viewpoint - President Trump's proposal to impose a 10% cap on credit card interest rates aims to protect consumers from high-interest rates, but it may lead to significant restrictions on credit access for many Americans, particularly low to moderate-income households [2][3][7]. Impact on Consumers - The Electronic Payments Coalition (EPC) estimates that 82% to 88% of credit card holders could see their cards eliminated or their credit limits drastically reduced due to the proposed cap [3][4]. - Nearly all credit card accounts associated with a credit score below 740 would be closed or severely restricted, affecting approximately 175 million to 190 million American cardholders [7]. - The average credit score for low-income Americans is reported at 658, while it is 735 for middle-income households, indicating a significant disparity in credit access [7]. Impact on Small Businesses - Small business owners, who often use personal credit cards alongside business accounts, would face compounded restrictions, affecting their financial operations [15][16]. - The reliance on credit cards for cash flow is critical for small businesses, with 98% of them making under a million dollars in gross receipts annually [16]. Changes in Credit Access - Remaining cardholders would experience lower credit limits, tighter underwriting standards, and reduced or eliminated rewards, regardless of their credit scores [8]. - Consumers may turn to riskier alternatives, such as payday lenders and unregulated online lenders, which are exempt from the proposed cap [11].