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continuously since 2011, including during years when the Many rely on partner banks and thin margins supported
Fed was not profitable. The Fed returned to profitability in by a balance of interchange, interest income and scale. A
December 2025. hard cap could prompt banks to reassess risk, slow fintech
partnerships and raise barriers to entry, dampening inno-
The CFPB was established under the 2010 Dodd-Frank Act vation.
to protect consumers from abusive financial practices. Be-
yond employee litigation, the administration's defunding Acquirers could also feel indirect effects. Reduced cred-
effort has drawn opposition from state officials. Attorneys it availability or lower limits may lead to declining card
general from 21 states and the District of Columbia have spend, cutting into transaction-based revenue. At the
sued to block the move, arguing it is unlawful and under- same time, issuers may pursue higher fees, premium card
mines state consumer protection efforts. tiers or interchange optimization to offset lost interest in-
come, potentially raising acceptance costs for merchants.
New York Attorney General Letitia James emphasized that
states rely on CFPB complaint data and enforcement coor- JPMorgan CFO Jeremy Barnum signaled resistance, sug-
dination. Since 2023, New York alone has referred more gesting the industry could challenge price controls. El Haj
than 2,000 consumer complaints to the bureau. The case cautioned that shifting costs from interest to fees risks re-
underscores the CFPB's central role in financial oversight ducing transparency and undermining consumer protec-
as legal battles over its future continue. tion goals. Industry leaders stress that any APR cap must
consider the full payments ecosystem to avoid unintended
Proposed 10 percent APR cap could consequences.
hit fintechs, acquirers hard
Trump takes on Visa and Mastercard
President Donald Trump's renewed call to cap credit card
annual percentage rates at 10 percent has reignited debate President Donald Trump has intensified scrutiny of credit
across the payments industry, with issuers, fintechs and card costs by endorsing the Credit Card Competition Act
acquirers warning of significant downstream effects. (CCCA), legislation aimed at reducing merchant swipe
While the proposal is framed as consumer protection, fees by increasing network competition. The bill would
critics argue it could undermine the economics of card require large card issuers to enable at least two processing
issuing and reduce access to credit. networks per card, limiting Visa or Mastercard ownership
to one option.
Average U.S. credit card APRs exceed 20 percent, and
interest income plays a key role in offsetting credit risk, Introduced by Senators Roger Marshall and Richard
fraud losses and compliance costs. Radi El Haj, CEO Durbin and House sponsors Lance Gooden and Zoe Lof-
of RS2, warned that a 10 percent cap would compress gren, the CCCA seeks to give merchants routing choice,
margins and make serving higher-risk or thin-file allowing transactions to be processed over alternative
customers economically unviable. Likely responses networks such as Discover or regional EFT networks. Sup-
include tighter underwriting, lower credit limits or exits porters argue this competition would pressure Visa and
from underserved segments. Mastercard to lower interchange fees.

Fintech card programs may be particularly vulnerable. The legislation has backing from nearly 2,000 businesses
and a coalition of merchant, consumer and labor groups.
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swipe fees a "ripoff" and praising Sen. Marshall. Merchant
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weaken fraud protections, disrupt rewards programs and
reduce network investment. Visa and Mastercard have
historically opposed the measure, warning of higher costs
and reduced security.
The CCCA has been introduced multiple times since 2022
but has not advanced. Trump's renewed support may shift
political momentum, though passage remains uncertain
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