President Trump’s push to lower credit card interest rates and swipe fees faces an uphill climb on Capitol Hill, where lawmakers would need to enact legislation to implement the policies.
House Speaker Mike Johnson said capping credit card interest rates at 10%, as Mr. Trump floated last week, sounds great “at first glance” because it would help borrowers with credit card debt.
But experts have warned that could lead to credit card companies lending less money, “and maybe they cap what people are able to borrow at a very low amount,” the Louisiana Republican told reporters Tuesday.
“We’d have a lot of work to build consensus around it,” Mr. Johnson said. “In the inner zeal to bring down costs, you don’t want to have negative secondary effects of that.”
The speaker said he has talked to Mr. Trump about the proposal, and the president understands the need for lawmakers to be “deliberate” to ensure they are doing the right thing for Americans.
“What I love about this president is he’s willing to think outside the box and propose ideas for us to work through to see if it will actually achieve the desired objective, and that’s what we’re in the process of doing every day around here,” he said. “So again, I wouldn’t get too spun up about ideas that are out of the box, that are proposed or suggested.”
While Mr. Johnson committed to “work through” the idea, Kansas GOP Sen. Roger Marshall has said he would lead legislation to cap credit card interest rates.
“Just got off the phone with President @realDonaldTrump, and with his full support, we will be leading this legislation to lower costs for American families and to rein in greedy credit card companies who have been ripping off hardworking Americans for too long,” Mr. Marshall said last week on social media in response to the president’s 10% cap idea.
Mr. Marshall is already the lead sponsor of a bipartisan bill called the Credit Card Competition Act that aims to lower swipe fees that businesses pay to process credit card transactions and often pass down to consumers.
The measure would require banks with more than $100 billion in assets to offer their users at least two credit card networks, one of which must be something other than Visa and Mastercard. The idea is to increase credit card competition and force the large companies to lower their fees.
Mr. Trump on Tuesday endorsed the bill, which has been stalled in Congress for years despite Mr. Marshall having secured promises it would get a vote.
“Everyone should support great Republican Senator Roger Marshall’s Credit Card Competition Act, in order to stop the out of control Swipe Fee ripoff,” the president said on social media. “Roger is a FANTASTIC Senator!!!”
Mr. Marshall thanked the president for his support and reiterated his commitment to stopping big banks from raking in billions from credit card swipe fees “while hardworking Americans pay the price.”
The senator said the average American family pays $1,800 in credit card swipe fees and $1,500 in credit card interest a year.
Mr. Marshall said Monday on Bloomberg TV that passing legislation to crack down on those fees “will be a challenge,” but that Senate Majority Leader John Thune of South Dakota “has been very receptive to these conversations.”
“Americans are paying seven times more for swipe fees than the European Union is,” Mr. Marshall said, blaming the problem on an “oligopoly between two credit cards and a handful of banks.”
He said passing the Credit Card Competition Act is projected to lower the cost of groceries and gas by 1% to 2%.
“When the American people see that, they’ll get behind it and push their members of Congress to pass this. This could be one of the simplest things we could do to lower the cost of living for hard-working American families.”
Massachusetts Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, brought up the topic as she delivered a speech Monday on affordability.
She argued that if Mr. Trump wants to cap credit card interest rates, lower housing costs or other ideas he’s proposing on social media, he needs to use his leverage and call lawmakers to get them to back it.
The president called her after the speech.
“I told him that Congress can pass legislation to cap credit card rates if he will actually fight for it,” Ms. Warren said in a statement. “I also urged him to get House Republicans to pass the bipartisan ROAD to Housing Act, which passed the Senate with unanimous support and would build more housing and lower costs.”
