Joint Trades Opposition Letter to H.R. 1944

Dear Representatives Ocasio-Cortez and Luna:

The undersigned trade associations, representing credit unions, community banks, and both large and small financial institutions that serve hundreds of millions of American consumers, are united in opposition to H.R. 1944, the 10 Percent Credit Card Interest Rate Cap Act. By imposing government price controls on private products by creating an all-in annual percentage rate (APR) cap for credit cards at 10 percent, this legislation would severely restrict the availability of this type of credit for everyday consumers and effectively harm the very people the proposed legislation seeks to protect.

Research clearly shows that government price setting, even APR caps, hurts consumers

This bill would eliminate access to credit cards for millions of consumers and drive them to sources of credit which are far more costly and less regulated.1 Many consumers who currently rely on credit cards would be forced to turn elsewhere for short-term financing needs, including pawn shops, auto title lenders, or worse– such as loan sharks, unregulated online lenders, and the black market. Many Americans already use payday loans which can charge annual interest rates of more than 300 percent, and this legislation would direct more consumers to use these sources of credit which are far more expensive than credit cards.

Download the letter to read the full text.