— verified against Congress.gov, the NCUA, and the Federal Reserve.
In January, the headline was everywhere: credit card interest capped at 10%. Nine months later, your statement still says 23.99%. You didn’t miss a form, and your bank didn’t quietly break a rule — the cap never became a law in the first place.
No — there is no 10% cap on credit card interest in effect. The January 2026 call for a cap wasn’t a binding law, and the bill that would create one hasn’t passed Congress. But real, enforceable rate caps already exist for some borrowers today.
10% cap on credit card APRs. Called for in January 2026; the bills that would create it (S.381 / H.R.1944) are still sitting in committee.
18% maximum interest rate at federal credit unions, extended by the NCUA through September 10, 2027.
36% cap under the Military Lending Act, and a 6% cap under the SCRA for debt you had before entering active duty.
See what a lower rate would actually save you →
Where you are right now:
And the cap almost nobody mentions is one you can use today — it just isn’t at a big bank.
What Would a Lower Rate Save You?
Enter your own numbers to compare your current rate against the 18% federal credit union ceiling and the proposed (not-in-effect) 10% cap.
At your current APR
At 18% (federal credit union ceiling)
At 10% (proposed cap — not in effect)
Illustration only; assumes a fixed monthly payment and no new charges added to the balance. This is not a quote or an offer, and it isn’t financial advice.
1. What Actually Happened, Date by Date
| Cap | Rate | Who it applies to | Status |
|---|---|---|---|
| Proposed federal cap (S.381 / H.R.1944) | 10% APR | All consumer credit cards, nationwide | Proposed — pending in committee, not in effect |
| Federal credit union ceiling | 18% (statutory default 15%) | Loans, including credit cards, at federally chartered credit unions | In effect — extended through Sept. 10, 2027 |
| Military Lending Act (MLA) | 36% MAPR | Covered active-duty servicemembers and dependents, on credit extended during service | In effect |
| Servicemembers Civil Relief Act (SCRA) | 6% | Debt, including credit cards, incurred before entering active duty | In effect, upon request, for duration of active duty |
Sources: Congress.gov (S.381, H.R.1944); NCUA press release, Feb. 6, 2026; 32 C.F.R. Part 232 (Military Lending Act); 50 U.S.C. § 3937 (SCRA). Verified September 24, 2026.
The 10% cap didn’t appear out of nowhere in January 2026, and it didn’t disappear after the headlines faded either — it’s still sitting exactly where it was: in committee. Here’s the sequence, with nothing skipped.
Two bipartisan bills already existed before any of the January news happened. Sens. Bernie Sanders (I-VT) and Josh Hawley (R-MO) introduced the 10 Percent Credit Card Interest Rate Cap Act (S.381) on February 4, 2025, and Reps. Alexandria Ocasio-Cortez (D-NY) and Anna Paulina Luna (R-FL) introduced a companion bill, H.R.1944, in the House on March 6, 2025. Sen. Jeff Merkley (D-OR) and Sen. Kirsten Gillibrand (D-NY) later joined S.381 as cosponsors.
In September 2025, the Vanderbilt Policy Accelerator published an independent analysis estimating the consumer savings a cap could produce — the figure that later got attached to nearly every news story on this topic (more on that in the debate section below).
Then came January 2026. On January 9, President Trump posted on Truth Social calling for a one-year cap on credit card interest at 10%, saying it would be “effective January 20, 2026.” The same day, a coalition of banking trade groups — the American Bankers Association, Bank Policy Institute, Consumer Bankers Association, Financial Services Forum, and Independent Community Bankers of America — issued a joint statement opposing it, warning that a cap would push consumers toward less regulated, more expensive credit. Around January 12, Sen. Hawley publicly renewed his call for Congress to take up the bill. On January 13, a separate and unrelated bill, the Credit Card Competition Act, was reintroduced (see the disambiguation note below — it’s about payment networks, not interest rates). On January 16, a White House economic adviser floated a different idea entirely: rather than a mandatory cap, credit card issuers could voluntarily offer a lower-rate card product.
January 20 — the date the President’s post said the cap would take effect — came and went with no cap in place. That same day, the American Bankers Association published an analysis of its own, based on a member survey conducted from December 2025 through January 2026, estimating that a 10% cap could lead to a large share of open credit card accounts being closed or having credit lines reduced. The following day, January 21, speaking at the World Economic Forum in Davos, President Trump reframed the request, saying he was “asking Congress” to pass a 10% cap for one year.
On February 6, 2026, the NCUA — the federal regulator for credit unions — voted to extend its 18% interest rate ceiling for federal credit unions through September 10, 2027, unrelated to the 10% cap proposal but relevant to what’s actually available to borrowers today (covered in detail below).
As of the most recent check against Congress.gov, S.381 and H.R.1944 remain pending in their respective committees, with no markup recorded. For context: this isn’t the first time a bipartisan credit card rate cap has stalled. Sen. Hawley introduced a separate bill in 2023 proposing an 18% cap, and it also died in committee — a precedent, not a prediction of what happens to the current bills.
| Date | What happened | Did it change your rate? |
|---|---|---|
| Feb. 4, 2025 | Sens. Sanders and Hawley introduce S.381, the 10 Percent Credit Card Interest Rate Cap Act | No — referred to committee |
| Mar. 6, 2025 | Reps. Ocasio-Cortez and Luna introduce the House companion, H.R.1944 | No — referred to committee |
| Sept. 2025 | Vanderbilt Policy Accelerator publishes a savings analysis of a 10% cap | No — a research paper, not a law |
| Jan. 9, 2026 | President Trump calls for a 10% cap “effective January 20, 2026”; banking trade groups issue a joint statement opposing it | No — a social media post is not legislation |
| Jan. 13, 2026 | The unrelated Credit Card Competition Act is reintroduced | No — addresses payment networks, not interest rates |
| Jan. 16, 2026 | A White House economic adviser floats a voluntary lower-rate card as an alternative to a mandatory cap | No — not adopted as policy |
| Jan. 20, 2026 | The date the President’s post said the cap would take effect; the American Bankers Association separately publishes its own analysis on the cap’s effect on credit access | No — no cap took effect, and an industry analysis is not a law |
| Jan. 21, 2026 | At Davos, the President says he is asking Congress to pass a one-year 10% cap | No — a request to Congress still requires a bill to pass |
| Feb. 6, 2026 | NCUA extends the federal credit union 18% interest rate ceiling through Sept. 10, 2027 | Yes — if you belong to a federal credit union |
| Sept. 2026 (most recent check) | S.381 and H.R.1944 remain pending in committee, no markup recorded | No — still not law |
Sources: Congress.gov (S.381, H.R.1944); offices of Sen. Sanders and Sen. Hawley; Truth Social; CNBC, AP, and Reuters reporting, January 2026; American Bankers Association; NCUA press release, Feb. 6, 2026. Verified September 24, 2026.
2. Why No Cap Took Effect
An announcement isn’t a law.
A social media post, a request to Congress, and a speech at an economic forum are all forms of political pressure. None of them amend federal lending law on their own. Only a bill passed by both chambers of Congress and signed by the President — or a rule issued under existing legal authority — can actually create a binding rate cap.
The practical question people keep asking is whether the President can simply order banks to charge less. Under current law, a binding, nationwide cap on what private credit card issuers can charge would most likely require an act of Congress amending the Truth in Lending Act (the same law S.381 and H.R.1944 both propose to amend). The Consumer Financial Protection Bureau — the agency that normally enforces the Truth in Lending Act — is separately barred by statute from establishing a usury limit of its own. Under 12 U.S.C. § 5517(o), no part of the Consumer Financial Protection Act gives the CFPB authority to set a usury limit unless Congress explicitly authorizes it elsewhere. In plain terms: the one agency built to police credit card lending isn’t allowed to just declare a rate ceiling by itself.
That legal reality lines up with what actually happened. When the idea was first floated on January 9, 2026, reporting at the time indicated the administration was considering an executive order to impose the cap. No such executive order followed. Instead, at Davos on January 21, the President’s own framing shifted to “asking Congress” — which is functionally an endorsement of the pending bills, not an independent action. And within the administration itself, there wasn’t a single unified plan: on January 16, one White House economic adviser proposed a different approach altogether — a voluntary, lower-rate card product issuers could choose to offer, rather than a mandatory cap on all cards. That’s a meaningfully different idea from a legal cap, and it was never adopted as policy either. Add it up, and there was never a point at which a binding 10% cap was legally in force.
3. Where the Sanders–Hawley Bill Stands
S.381 would amend the Truth in Lending Act to cap the APR on any credit card at 10%, inclusive of finance charges. The cap would sunset after five years — per the Congressional Research Service’s summary, the relevant provisions expire January 1, 2031. A creditor that knowingly violates the cap would forfeit the entire interest on the debt, and the bill creates a private right of action letting a consumer sue to recover interest, finance charges, or fees within two years of a violation; violations are also enforceable as Truth in Lending Act violations by the CFPB and FTC.
The bill was introduced by Sen. Sanders (I-VT), with Sen. Hawley (R-MO) as the original cosponsor; Sen. Merkley (D-OR) and Sen. Gillibrand (D-NY) later signed on as additional cosponsors. It was read twice and referred to the Senate Committee on Banking, Housing, and Urban Affairs on February 4, 2025, and, as of the most recent check against Congress.gov, remains there with no committee markup recorded.
The House companion, H.R.1944, was introduced by Rep. Ocasio-Cortez (D-NY) with Rep. Luna (R-FL) as cosponsor, referred to the House Committee on Financial Services on March 6, 2025, and likewise remains pending with no markup recorded.
It’s worth knowing this isn’t the first attempt at a credit card rate cap to stall in committee. In 2023, Sen. Hawley introduced separate legislation proposing an 18% cap, and that bill also died without a committee vote. That’s useful context for calibrating expectations — it is not a prediction about what will happen to S.381 or H.R.1944. Whether either bill advances depends on whether the relevant committee schedules a hearing or markup, and that hasn’t happened as of this writing.
4. The Debate, Fairly
Both sides of this debate have published numbers. Neither set of numbers is “the truth” so much as a modeled estimate built on different assumptions — so here’s what each side argues, and who’s making the argument.
The case for a cap: Sanders and Hawley have argued that interest rates well above 25% amount to more than ordinary lending — in their public statements, they’ve characterized it as extracting profit from borrowers who have few alternatives. In September 2025, the Vanderbilt Policy Accelerator, an academic policy group, published an analysis by Brian Shearer, a former CFPB official, estimating that a 10% cap could save American cardholders roughly $100 billion a year in interest, compared with about $48 billion a year at a 15% cap. The analysis argued that because credit card issuers earn substantial revenue from interchange (the fees merchants pay on each transaction), they could likely absorb a cap without eliminating rewards programs across the board — though it acknowledged lower-credit-score borrowers would likely see the biggest reduction in rewards and available credit.
The case against a cap: The banking industry’s position, laid out in the January 9, 2026 joint statement from the American Bankers Association and allied trade groups, is that a hard cap would function as a government price control and reduce the availability of credit — pushing some borrowers toward less regulated and potentially costlier alternatives. The ABA followed up on January 20, 2026 with an analysis based on a member survey of issuers combined with credit bureau data, estimating that 74% to 85% of open credit card accounts could be closed or have their credit lines reduced under a 10% cap, affecting an estimated 137 million to 159 million cardholders — a figure the ABA says would reach well beyond subprime borrowers into prime credit tiers. At Davos, JPMorgan CEO Jamie Dimon separately suggested testing a cap in a small number of states first before considering it nationally, warning of what he called significant disruption to the credit card business.
Supporters’ case
- Rates above 25% are framed as extraction, not ordinary lending, by the bill’s sponsors.
- Vanderbilt Policy Accelerator (Sept. 2025): roughly $100B/year in consumer savings at a 10% cap.
- Interchange revenue could let issuers absorb a cap without eliminating rewards broadly, per the same analysis.
Industry’s case
- ABA and allied trade groups (Jan. 9, 2026): a cap functions as a price control that reduces credit access.
- ABA analysis (Jan. 20, 2026): 74%–85% of open accounts could be closed or reduced, an estimated 137M–159M cardholders affected.
- JPMorgan CEO Jamie Dimon (Davos, Jan. 2026): proposed a limited state-level test before any national cap.
This article isn’t going to predict whether either side wins that argument in Congress — that’s a political outcome, not a factual one. What’s verifiable is that both figures come from real, published analyses, built on different assumptions about how issuers would respond to a cap, and both are attributed here to their source rather than presented as settled fact.
5. The Cap You Can Use Today: Federal Credit Unions
This cap is real — and you can use it today.
The Federal Credit Union Act limits federal credit unions to a 15% interest rate ceiling on loans by default. But the NCUA Board can temporarily authorize a higher ceiling — up to 18% — for periods of up to 18 months, when money-market rates and safety-and-soundness conditions meet specific statutory criteria. The NCUA has kept that temporary ceiling at 18% continuously since May 1987, renewing it roughly two dozen times, most recently voting on February 6, 2026 to extend it through September 10, 2027. A federal credit union that knowingly charges above that ceiling forfeits the interest on the loan — the same kind of enforcement mechanism the proposed 10% bill would create, already in force today.
The critical word here is federal. This 18% ceiling applies specifically to federally chartered credit unions — those regulated directly by the NCUA. It does not apply to state-chartered credit unions, which follow their own state’s usury and lending laws instead, and those can be higher or structured differently depending on the state. It also has nothing to do with banks, which have no comparable federal interest rate ceiling at all and generally charge whatever their home state allows, regardless of where the customer lives.
There’s one carve-out worth knowing: the NCUA’s ceiling has a separate, higher allowance for Payday Alternative Loans (PALs) — a specific small-dollar loan product some federal credit unions offer as a safer substitute for payday loans — which can carry interest up to 28%. That’s a different product from an ordinary credit card or personal loan, and it doesn’t change the 18% ceiling that applies to standard lending, including credit cards.
How to check whether a credit union is federally chartered
- Look at the name — many federal credit unions include “Federal Credit Union” directly in their name, though this isn’t universal.
- Check for NCUA share insurance signage or disclosures, which typically indicate federal charter and federal deposit insurance through the NCUA.
- Ask the credit union directly which regulator charters it — a federal charter falls under the NCUA; a state charter falls under that state’s credit union regulator.
Membership basics
Credit unions, federal or state, generally require you to meet a membership eligibility rule before you can open an account — tied to your employer, where you live, an association you belong to, or a family member’s existing membership. Eligibility rules vary widely by institution, so the only reliable way to know if you qualify is to check with a specific credit union directly. This article isn’t recommending a particular credit union or card product — just explaining how to identify the charter type that determines whether the 18% ceiling actually applies.
6. If You’re Military: Two Caps That Already Apply
Two separate federal laws cap interest rates for servicemembers and their families — and which one applies depends entirely on when the debt was incurred.
Military Lending Act (MLA) — 36% cap on credit taken out during active duty
The MLA caps the Military Annual Percentage Rate (MAPR) at 36% on covered credit products — including credit cards — extended to covered active-duty servicemembers and their covered dependents. Unlike a standard APR, the MAPR calculation is required to include most associated fees (such as annual fees and certain credit-related charges), not just the stated interest rate, which makes it a broader measure of total cost.
Servicemembers Civil Relief Act (SCRA) — 6% cap on debt from before active duty
The SCRA caps interest, including on credit cards, at 6% — but only on debt you incurred before entering active-duty service. It doesn’t apply automatically; you generally need to request it from your card issuer and provide documentation of your active-duty status. Interest above 6% is meant to be forgiven for the duration of your active duty, not merely deferred, and the benefit lasts for as long as you remain on active duty.
The distinction to hold onto: SCRA looks backward, at debt from before you were in service. The MLA looks at credit extended while you’re already serving. If you’re covered by either law and think your card issuer isn’t honoring it, that’s a conversation to have directly with the issuer, with your service documentation in hand.
7. Setting the Record Straight
A few details about this story get garbled in retelling. Here’s the corrected version, without pointing fingers at any particular source.
The exact dates: President Trump’s initial call for a cap came via a January 9, 2026 social media post, which stated the cap would be “effective January 20, 2026” — the one-year anniversary of his second inauguration. No cap took effect on either of those dates. Twelve days after the original post, on January 21, 2026, at the World Economic Forum in Davos, the President reframed the request as asking Congress to pass legislation — a materially different, and legally accurate, description of what it would actually take.
One more disambiguation: the Credit Card Competition Act, reintroduced on January 13, 2026, is a separate and unrelated bill. It addresses how credit card transactions are routed between payment networks — aimed at reducing the “swipe fees” merchants pay — and has nothing to do with the interest rates charged to cardholders. If you’ve seen headlines mentioning both bills in the same breath, they are not the same proposal.
8. What This Isn’t
This article covers the status of the proposed cap and the real caps available today — it isn’t a full explainer on any of the following, but here’s where to go for each:
- For how credit card interest is actually calculated day to day, see How Credit Card Interest Works: APR Explained.
- For a strategy to pay down an existing balance faster, see How to Pay Off Credit Card Debt Fast (Even at 22% APR).
- A 0% introductory-APR balance transfer card is a temporary bridge while you wait to see what happens with any of the above — not a substitute for a permanent cap — see Best Balance Transfer Credit Cards: 0% APR Picks.
9. FAQ
Did credit card interest rates get capped at 10%?
No. As of the most recent verification against Congress.gov, no nationwide 10% cap on credit card interest is in effect. The January 2026 announcement was a call for a cap, not a law.
Can the president cap credit card interest by executive order?
Not unilaterally for private lenders generally. A binding, nationwide cap would most likely require Congress to amend the Truth in Lending Act. No executive order imposing such a cap has been issued.
What’s the maximum interest a federal credit union can charge?
Currently 18%, under a temporary ceiling the NCUA extended through September 10, 2027. The statutory default, absent that temporary ceiling, is 15%.
Do state-chartered credit unions have the same cap?
No. The 18% ceiling applies only to federally chartered credit unions regulated by the NCUA. State-chartered credit unions follow their own state’s rules, which vary.
Would a 10% cap cause banks to close accounts?
Supporters and the banking industry disagree, and both have published estimates. See the “Debate, Fairly” section above for sourced figures from each side.
Does the Military Lending Act cover credit cards?
Yes. The MLA caps the Military Annual Percentage Rate at 36% on covered credit products, including credit cards, for covered active-duty servicemembers and their dependents.
What’s the difference between the MLA and SCRA rate caps?
Timing. The SCRA’s 6% cap applies to debt incurred before you entered active duty. The MLA’s 36% cap applies to credit extended while you’re already on active duty.
Where does the Sanders–Hawley bill (S.381) stand right now?
It was introduced in February 2025 and remains pending in the Senate Banking, Housing, and Urban Affairs Committee, with no committee markup recorded as of the most recent check.
Is there a House version of the bill?
Yes — H.R.1944, introduced by Reps. Ocasio-Cortez and Luna, which remains pending in the House Financial Services Committee.
What’s the Credit Card Competition Act, and is it the same thing?
No, it’s a separate bill. It addresses competition among card payment networks and swipe fees charged to merchants — not the interest rates charged to cardholders.
How do I check if my credit union is federally chartered?
Check the institution’s name, look for NCUA share insurance disclosures, or simply ask the credit union which regulator charters it.
Is a 0% balance transfer card a substitute for a rate cap?
It’s a temporary bridge for a limited promotional period, not a permanent cap. See our balance transfer card roundup linked above for how that option works.
This is a fast-moving, status-sensitive topic — the legislative status above reflects the verification date and may have changed since.
This article is for educational purposes only and is not financial or legal advice. Legislative status reflects information available as of the date noted above and may change. The rate caps and protections described depend on lender type, charter, and individual eligibility — confirm current details with the relevant institution or agency before making a financial decision.
Daniel Hayes is the founder and sole researcher at AdvoraHQ. He covers U.S. personal finance, insurance, and consumer law — working directly from IRS publications, federal and state statutes, court opinions, and SEC filings rather than secondary summaries. His focus is the gap between what readers think they know and what the source documents actually say. Daniel is not a licensed attorney, CPA, or financial advisor; his articles are educational and not personalized advice. Reach him at Daniel.Hayes@advorahq.com.
