Credit card interest has quietly become one of the most punishing household expenses in America, with typical annual percentage rates hovering in the low 20s even for borrowers with solid histories. Now President Donald Trump’s push to cap card rates at 10 percent for a year has jolted the industry, and Bank of America is weighing a new product that would match that ceiling. The move would mark a sharp break from the status quo and could redraw the line between affordable borrowing and high-cost plastic.
At stake is whether a 10 percent ceiling becomes a temporary political gesture or the starting point for a structural reset in consumer credit. Bank of America’s deliberations, and the way rivals respond, will determine whether millions of cardholders see real relief or simply a reshuffled deck of fees, perks, and access to credit.
The Trump-era 10% cap collides with a 22% card world
The starting point for understanding Bank of America’s calculus is how far current card pricing has drifted from anything resembling single digits. The average credit card APR is around 22 percent, according to current rates, which means a 10 percent ceiling would effectively cut borrowing costs in half for many households. That gap is why President Donald Trump’s allies frame the proposal as a direct attack on what they describe as usurious pricing, and why banks warn that such a cap would force them to rethink who gets approved and on what terms. For borrowers who revolve balances month after month, the difference between 22 percent and 10 percent is not academic, it is the difference between treading water and actually paying down principal.
Trump has floated legislation that would limit what credit card companies can charge for one year, with the cap set at 10 percent APR. Analysts note that Under Trump, the cap is explicitly temporary, pitched as a way to give households breathing room while inflation and borrowing costs remain elevated. A separate analysis of what a 10 percent ceiling would mean for Americans’ wallets argues that Trump’s call for a cap promises to save Americans billions in interest, but also warns that lenders could respond by tightening access to credit and trimming perks, a trade-off that would be felt most acutely by people with weaker scores who rely on plastic as a financial backstop, according to Veronica.
Trump’s political bet on affordability and “usury”
Trump has wrapped the 10 percent cap in populist language about affordability, casting it as part of a broader effort to ease the cost of living. In a social media post amplified by supporters, he touted the initiative as “Another Campaign Promise Kept” and branded it “AFFORDABILITY,” declaring that, effective January 20, 2026, he is calling for a 10 percent ceiling as President of the United States, according to a post. The rhetoric is designed to resonate with millions of Americans who have watched their card bills swell as rates climbed, and who see little connection between the cost of funds for banks and the double digit APRs on their statements.
Behind the slogans sits a concrete legislative push. Trump has announced support for a bill that would cap credit card interest rates at 10 percent per annum for one year, a move that has already drawn sharp responses from the banking lobby and consumer advocates alike. Legal analysts at Consumer Finance Monitor note that the proposal revives old debates about usury limits and federal preemption, and they highlight Trump’s own rhetorical question, “Whatever have happened to usury?” as a signal that the White House is willing to challenge long standing industry norms. A separate consumer focused breakdown of the plan, framed as “5 Things to Know About Trump’s Proposed 10% Interest Cap on Credit Cards,” stresses that while a cap sounds like a dream for borrowers, it also ushers in a host of unintended consequences, according to Things.
Bank of America’s 10% card: a test case with fewer perks
Into this political storm steps Bank of America, which is now considering whether to offer a credit card with interest capped at 10 percent for a year, according to a person familiar with the bank’s internal discussions. Reporting indicates that Bank of America is exploring a product that would align with the proposed cap but only for a limited period, effectively creating a pilot program inside its broader portfolio. The bank is not alone in this reassessment, but as one of the country’s largest card issuers, its decision will be read as a signal of how seriously the industry takes the political pressure.
Analysts who follow Bank of America Corporation, which trades on the NYSE under the ticker BAC, say the bank is evaluating new credit offerings in light of Trump’s proposal and the potential for regulatory change. On January 22, Reuters reported that Bank of America Corporation (NYSE:BAC) is among the most profitable financial stocks and is weighing how a capped rate card would fit into its earnings mix, given that interest income from revolving balances is a key profit driver. A separate breakdown of “Story Highlights” notes that Bank of America is considering introducing a 10 percent interest rate credit card that would likely exclude rewards and some familiar perks, underscoring that any lower rate product is likely to come with trade offs, according to Story Highlights.
Wall Street’s reaction and the Citi factor
Markets have already started to price in the possibility that capped rate cards will become a meaningful part of big banks’ strategies. When news broke that Bank of America was considering new credit cards with a 10 percent interest rate, its shares were nearly 1.1% higher in afternoon trading, while Citi was up nearly 2%, according to Reuters. That reaction suggests investors see potential upside in banks getting ahead of the political curve, even if lower rates on some products could compress margins in the short term.
Trump, who first called for a 10 percent interest cap, has also put direct pressure on major issuers to align with his agenda, and some are starting to bend. One analysis notes that Bank of America and Citi are reported to be preparing new cards with 10 percent rates and fewer benefits, a sign that the two giants are breaking from a previously unified front against Trump’s 10 percent rate cap, according to Bank of America. A separate video report notes that Bank of America and CT Group are now considering new credit cards with capped 10 percent rates, reinforcing the sense that at least two major players are preparing to live in a world where Trump’s cap, or something close to it, becomes a reality, according to Bank of America.
What a 10% world means for borrowers and access to credit
For households already carrying balances, the appeal of a 10 percent card is obvious. One consumer finance explainer notes that the big benefit for anybody who has credit card debt is that you will simply spend a lot less on interest, freeing up cash to pay down principal or cover other bills, according to a segment on the Impacts of Trump’s proposed credit card rate cap. Another breakdown of what a credit card rate cap would mean for you reiterates that the current average APR is around 22 percent and that, under Trump’s proposal, the maximum would be 10 percent, a shift that would dramatically lower the cost of carrying a balance for those who qualify, according to APR.
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*This article was researched with the help of AI, with human editors creating the final content.
Silas Redman writes about the structure of modern banking, financial regulations, and the rules that govern money movement. His work examines how institutions, policies, and compliance frameworks affect individuals and businesses alike. At The Daily Overview, Silas aims to help readers better understand the systems operating behind everyday financial decisions.
