Democrats Prepare To Cap Credit Card Interest Rates At 10%. Graham Stephan Says It's 'Classic 'Help The Poor' Policy That Does The Opposite'
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Senate Democrats are preparing to cap credit card interest rates at 10%, a move that could save Americans billions in interest payments. But personal finance YouTuber Graham Stephan says the proposal will backfire, leaving millions of people without access to credit.
“Capping unsecured credit card rates at 10% is pure performance. This will never happen,” Stephan wrote on X recently, responding to reports of the Democrats’ plans.
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Stephan Warns Millions Could Lose Access To Credit
Stephan said banks simply couldn’t afford to lend money at such low rates, especially to borrowers with a higher risk of missing payments.
Capping unsecured credit card rates at 10% is pure performance. This will never happen.
You cannot profitably lend money with no collateral when charge-offs run 4%+, and fraud + operating costs eat the rest.
Banks will simply stop issuing cards to anyone who isn’t already… https://t.co/A4Yp3XG6pV
— Graham Stephan (@GrahamStephan) November 9, 2026
“You cannot profitably lend money with no collateral when charge-offs run 4%+, and fraud + operating costs eat the rest,” he wrote.
He also said that banks would stop issuing credit cards to anyone who wasn’t already financially secure.
“Result: millions lose access to credit entirely and get pushed into worse alternatives,” he added.
He finished with a sharp criticism of the proposal, calling it a “Classic ‘help the poor’ policy that does the opposite.”
The debate comes as Americans’ credit card debt continues to grow. According to the Federal Reserve Bank of New York, balances reached more than $1.29 trillion in Q3 of 2026, up $22 billion from the previous quarter and $52 billion from a year earlier.
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Meanwhile, the average credit card interest rate stood at 24.88%, according to Forbes.
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Warren Is Ready To Move Forward, But Bank Executives Warn Of A Recession
Sen. Elizabeth Warren (D-MA), who is expected to chair the Senate Banking Committee when Democrats take control of Congress in January, says she’s ready to move forward with the proposal.
Speaking with CBS News recently, Warren pointed out that President Donald Trump had also supported a 10% cap earlier this year.
Trump called for a one-year cap in January, but banking executives quickly pushed back.
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Capital One (NYSE:COF) CEO Richard Fairbank said during the company’s January earnings call that banks would be “compelled to immediately slash credit lines, restrict accounts, and limit new originations to a very small subset of consumers.”
Fairbank pointed out that Americans spend $6 trillion annually using credit cards. He warned that a sharp reduction in available credit “would likely bring on a recession.”
JPMorgan Chase (NYSE:JPM) CEO Jamie Dimon also warned in January that the proposal could remove access to credit for 80% of Americans, calling the potential consequences an “economic disaster.”
Brookings Institution fellow Jessica Riedl raised similar concerns, warning that banks could cancel cards for borrowers with credit scores below 750, leaving many dependent on payday loans and other expensive borrowing options.
Despite the warnings, Warren says Democrats are ready to pursue the cap, setting up a major fight over how far Washington should go to bring down borrowing costs.
“I got the bill, I’m ready to go,” she told CBS News.
Image: Shutterstock
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This article Democrats Prepare To Cap Credit Card Interest Rates At 10%. Graham Stephan Says It’s ‘Classic ‘Help The Poor’ Policy That Does The Opposite’ originally appeared on Benzinga.com
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