Credit card cap at 10% would hit up to 159 million US cardholders, warns ABA

Core Viewpoint - A proposed federal ceiling of 10% on credit card interest rates could significantly limit access to revolving credit for US consumers, potentially affecting between 137 million and 159 million existing cardholders [1][2] Group 1: Impact on Credit Card Access - The American Bankers Association (ABA) indicates that 74% to 85% of active US credit card accounts would either be closed or face substantial cuts to their credit limits under a 10% annual percentage rate cap [2] - The measure is expected to "effectively eliminate" credit cards as a day-to-day payment option for tens of millions of Americans, according to ABA president and CEO Rob Nichols [3] - The impact of the proposed cap would extend beyond higher-risk borrowers, affecting most cardholders, including those who regularly clear their balances, leading to stricter underwriting and reduced credit options [4] Group 2: Effects on Borrowers and Economy - Among cardholders with VantageScores above 600, between 71% and 84% would see their accounts shut or their credit lines sharply reduced, including many "super-prime" customers with VantageScores above 780 [5] - The ABA warns of potential loss of access to regulated credit in emergencies, which may push borrowers towards less-regulated and more costly alternatives [6] - The proposed cap could reduce consumer spending power, negatively impacting small businesses and the broader US economy, which relies on nearly $3.6 trillion in annual purchases made using consumer credit cards [6]