'We Would Likely See A Significant Contraction,' SoFi CEO Anthony Noto Says Of Trump's 10% Cap Plan — Consumers 'Will Still Need Access To Credit'

Core Viewpoint - A proposed 10% cap on credit card interest rates may lead to a contraction in credit card lending rather than a decrease in consumer borrowing demand, according to SoFi Technologies CEO Anthony Noto [1][2]. Group 1: Impact on Credit Card Lending - If the interest rate cap is enacted, a significant contraction in industry credit card lending is expected, as credit card issuers may struggle to maintain profitability under such constraints [2]. - Credit card issuers may respond to the cap by reducing approvals, lowering credit limits, or closing accounts, indicating that the risk does not disappear but rather shifts [3]. Group 2: Consumer Borrowing Behavior - Despite potential changes in credit card access, consumers will still require credit for routine expenses and unexpected costs, suggesting a persistent demand for borrowing [3]. - As access to credit cards narrows, borrowing may shift towards other options like personal loans, which typically offer lower interest rates and amortizing structures that help pay down balances over time [5][6].