Sponsors (4)
The bill lowers borrowing costs and provides restitution and stronger deterrence against usurious credit pricing for consumers, but risks reduced credit access, higher non‑interest fees, increased litigation-related costs, and regulatory uncertainty for lenders and some borrowers.
Consumers carrying credit card debt (especially middle-class and low-income households) would pay substantially less interest and face lower monthly payments because APRs and all finance charges would be capped at 10%.
Cardholders who were charged over the legal rate can recover all interest, finance charges, and fees paid within two years of the last usurious collection, giving harmed consumers a clear path to restitution.
Consumers (particularly vulnerable borrowers) benefit from a strong deterrent because creditors who knowingly exceed the cap forfeit the entire interest on the obligation, discouraging predatory pricing.
Higher‑risk borrowers (largely low‑income individuals and some middle‑class families) may face reduced access to credit because banks and card issuers could tighten underwriting or limit credit availability in response to capped interest revenue.
Card issuers may raise non‑interest costs (late fees, annual fees, reclassification of allowable fees) or shift costs to other products to offset lost interest income, potentially increasing out‑of‑pocket costs for many cardholders.
Increased litigation and compliance costs for lenders (from enforcement and disputes over the cap) could be passed along to consumers through higher fees or reduced card benefits.
Based on analysis of 2 sections of legislative text.
Caps credit-card APR at 10 percentage points including finance charges, limits fee-based evasion, allows forfeiture/recovery of unlawful interest, preserves stronger state laws, and sunsets Jan 1, 2031.
Introduced February 4, 2025 by Bernard Sanders · Last progress February 4, 2025
Sets a nationwide cap that limits annual percentage rates (APR) on credit-card extensions of credit to 10 percentage points including all finance charges, restricts use of fees to evade that cap, and authorizes borrowers to recover interest and fees collected above the cap. It preserves stronger state consumer protections, makes knowing violations subject to forfeiture of all interest on the obligation and statutory remedies, and sunsets the new provisions on January 1, 2031.