On Friday, Jan. 9, President Trump shared a message on Truth Social calling for a credit card interest rate cap starting Jan. 20, 2026 — just 11 days after posting. His proposal would cap rates at 10%, a promise he promoted during his 2024 campaign.
While the idea of capping credit card interest rates has garnered bipartisan support in the past, some experts and industry groups warn of its potential impact on borrowers with lower credit scores.
Not only would implementing a large-scale cap on all credit card interest rates within a short window be incredibly difficult, but there's also no immediate legal authority to do so. The most likely path would be through Congress passing legislation, which hasn't happened and is unlikely to be completed by the Jan. 20 deadline.
CNBC Select covers what you need to know about Trump's proposed credit card interest rate cap, alongside options to consider under tighter credit conditions.
How a 10% rate cap could affect consumers
According to Federal Reserve data, the average interest rate on credit card accounts that incur interest was 22.30% as of November 2025. The proposed cap would cut rates by more than half. While on the surface that sounds great, paying roughly half of what you were paying before in interest could cause a lot of long-term problems.
Per Trump's Truth Social post, the potential interest rate cap would last only one year. After this temporary cut, card issuers would then be able to restore rates to current levels. Consumers could comfortably take on new or more debt at 10% interest, only to be worse off when rates reset to 20% or higher.
This rate cap could also have some pretty negative consequences for those with lower credit scores. One reason banks are able to lend credit to riskier borrowers is that they can charge higher interest rates to recoup losses. If interest rates are capped, banks could stop offering credit products to those with poor credit scores, potentially forcing consumers to turn to less secure or more expensive options. We could also see a reduction in credit card benefits and rewards, along with an increase in credit card fees to help offset banks' losses.
It's unclear exactly how Trump intends to enforce the proposed rate cap and what will happen once Jan. 20 arrives.
Other options if credit gets tighter
If the proposed credit card rate cap comes to fruition, or if you're simply looking for ways to access more funds, here are some alternatives to credit cards:
HELOCs
While only applicable to homeowners, a home equity line of credit (HELOC) can be a great alternative to a credit card, as both are revolving lines of credit. A HELOC lets you borrow against the equity in your home, and you may be able to access more money than with a credit card. Since your house is used as collateral, it's critical that you make your payments. CMG Financial offers HELOCs ranging from $20,000 to $400,000, and its 5-Day HELOC lets you access funds much faster than the three to six weeks other lenders typically require.
CMG Financial Home Equity
Loan types
Home equity loan and HELOC
Minimum credit score
620
Maximum loan-to-value
90%
Home equity loan limits
$25,000 to $750,000 for Flex HELOC
HELOC draw amount
$20,000 to $500,000 for Flex HELOC
Terms
Home equity loans: 10 to 30 years. HELOC: 20 years
Availability
Available in all 50 states
Pros
- Quick access to funds, so you can get your cash as soon as possible.
- High LTV, meaning you can maximize the amount you take out.
- Flexible repayment period
- Relatively low credit score requirements perfect for those with a less-than-perfect credit score.
Cons
- Current rates not available online
- High draw minimum
Personal loans
If you don't own a home or would prefer your funds in a lump sum as opposed to a revolving line of credit, consider a personal loan. Personal loans typically come with extra costs, like origination or administrative fees, but many are accessible to those with lower credit scores. Avant offers a straightforward online application and can provide funding as early as the next business day if you're approved.
Lends to applicants with poor credit and offers next-day funding.
- Lends to applicants with poor credit
- No early payoff fee
- Can prequalify with a soft credit check
- Funding often available next day
- Late-payment grace period of 10 days
- Origination fee
- Potentially high interest
- No autopay discount
- No direct payments to creditors for debt consolidation
- No co-signers
Debit cards
While debit cards carry more risk than credit cards, they're more accessible and can help you better control your spending. Debit cards pull directly from your bank account, so it's harder to go into debt. However, they typically don't offer the same fraud protections or dispute rights as credit cards. The Discover® Cashback Debit Checking doesn't require a minimum deposit to open, and you can earn 1% cash back on up to $3,000 in debit card purchases each month.
- Top-rated mobile app
- No minimum deposit to open an account
- 1% cash back on up to $3,000 in debit card purchases each month
- Opt-in to free overdraft protection
- No overdraft fees
- No reimbursement for out-of-network ATM fees
Offers in this section are from affiliate partners and selected based on a combination of engagement, product relevance, compensation, and consistent availability.
From 2.00% to 4.05% APY
1% cash back on up to $3,000 in debit card purchases each month.
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At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed decisions with their money. Every credit card article is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of credit card products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.
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