Bill · S. 381· Senate(119-S-381)
10 Percent Credit Card Interest Rate Cap Act
- Introduced
- 2/4/2025
- Last activity
- 2/4/2025 — Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
- Sponsored by
- Bernie Sanders
- Cosponsors
- - 0 - 2
- Introduced
- In Committee
What this bill would do
This bill, titled the "10 Percent Credit Card Interest Rate Cap Act," aims to amend the Truth in Lending Act. It proposes to cap the annual percentage rate for credit cards at 10 percent, including all finance charges. The legislation includes provisions to prevent the use of various fees to bypass this interest rate limit. It also establishes penalties for creditors who knowingly charge rates or fees exceeding the cap. Additionally, it allows consumers to take legal action to recover interest or fees paid in violation of these rules. Finally, the bill includes a sunset provision that removes these specific amendments on January 1, 2031.
Yes· 3 of 6
Does this give people more protection from unfair business practices?+8
The bill caps credit card interest rates at 10 percent and prevents the use of hidden fees to circumvent this limit.
Would households on low incomes be better off under this?+7
Capping interest rates provides significant financial relief to households that rely on credit.
Would middle-income households be better off under this?+5
The cap reduces the total cost of credit card debt for middle-income families.
The opposite
Would business owners be better off under this?-6
Creditors and financial institutions face significantly reduced revenue due to the interest rate cap.
Who it would affect, and how
Potential Positive Impacts for People
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Interest Rate Limits: The bill sets a cap where the annual percentage rate for credit card extensions of credit cannot exceed 10 percentage points, inclusive of all finance charges (Section 2(a)(1)). This limits how much interest individuals are charged on their credit card debt.
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Fee Regulation: It prevents creditors from using fees that are not considered finance charges to evade the 10 percent limit, and mandates that these fees cannot exceed the total amount of finance charges assessed (Section 2(a)(2)). This protects against hidden costs intended to circumvent the cap.
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Recovery of Overcharges: Consumers who have paid interest or fees exceeding the permitted limit can bring an action within 2 years to recover the entire amount of those interest, finance charges, or fees (Section 2(a)(4)). This provides a mechanism for people to get their money back if they are charged too much.
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Accountability for Creditors: The bill states that knowingly charging a rate or fee higher than permitted is a violation that results in the forfeiture of the entire interest agreed upon (Section 2(a)(3)). It also subjects violating creditors to the provisions of section 130 (Section 2(a)(5)).
Potential Negative Impacts for People
- Temporary Nature of Protections: The amendments are subject to a sunset provision that strikes the new rules from the Truth in Lending Act effective January 1, 2031 (Section 2(c)(1)). This means the protections established by this bill would cease to exist after that date.
Groups and Interests Ranking
Every group the model scored this bill for, from -10 to +10. Hover a score for the reason it gave.
- Demographic And Interest Groups
- Good For Low Income Households+7Good For Middle Class Households+5Good For Urban Residents+3Good For Business Owners-6
- Economy And Finance
- Improves Consumer Protection+8
- Governance And Ideology
- Improves Due Process+5
- Social Issues And Justice
- Improves Poverty Reduction+4
- 10/8/2025
- 1 Cosponsor added.
- 3/11/2025
- 1 Cosponsor added.
- 2/4/2025
- Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
- 1 Cosponsor added.
- Introduced in Senate
One bill Congress.gov lists as related to this one — companions in the other chamber, earlier versions, and bills this one absorbed or was folded into.
Kirsten GillibrandDemocrat · New York
Josh HawleyRepublican · Missouri
Jeff MerkleyDemocrat · Oregon