Lawmakers Propose Cap on Credit Card Interest Rates

Representatives Alexandria Ocasio-Cortez and Anna Paulina Luna introduced bipartisan legislation in March to cap credit card interest rates at 10% annually as Americans' debt hits record levels. 'Credit cards with high interest rates regularly trap working people in endless cycles of debt,' Ocasio-Cortez said in a statement.

Credit card debt has reached $1.2 trillion in Q4 2024, up from $720 billion in the same quarter of 2004, according to Federal Reserve Bank of New York data. Average annual percentage rates nearly doubled to 21% in 2024 from 12% in 2003. The Federal Reserve Bank of Philadelphia reported a record number of cardholders making only minimum payments in Q3 2024, 'showing signs of consumer stress.'

Further reading: Study Reveals Why Credit Card Interest Rates Remain Stubbornly High.

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