Fintechs push 36% state rate caps

Core Insights - The debate over a 36% interest rate cap on credit card balances is intensifying at the state level, as federal efforts have largely stalled [1][4][5] - Digital payment companies are advocating for this cap to create a more uniform lending environment across states [3][4] - Major banks typically adhere to a 36% cap for credit card lending, but this is not mandated by federal law for all consumers [2][4] Group 1: Legislative Efforts - The Military Lending Act imposes a 36% cap on loans for active-duty service members, but this does not extend to all consumers [2] - Congressional attempts to establish a nationwide 36% cap have failed, with recent proposals like the Predatory Lending Elimination Act not gaining traction [4][5] - The push for state-level legislation is partly due to the current federal administration's lack of interest in consumer financial oversight [5] Group 2: Industry Reactions - The American Fintech Council, representing companies in the buy now, pay later sector, is actively involved in state discussions regarding interest rate caps [3][4] - Variations in state interest rate caps complicate the ability of online lenders to offer consistent products [4] - Banks have opposed proposals for a lower interest rate cap, including a bipartisan bill that suggests a 10% cap for five years [6]