The South Dakota Bankers Association is voicing “strong opposition” to President Donald Trump’s proposed cap on credit card and interest rates.
The president said he wants to put a one-year 10% cap in rates. Federal reserve data shows credit cart rates have risen in recent years, with the average rate currently approaching 20%.
However the state Bankers Association said in a statement this move represents unnecessary government interference.
SDBA President Karl Adam called the cap a “government price control that would reduce access to credit and eliminate options for millions of Americans.”
The group also opposed the Credit Card Competition Act recently introduced in Congress. Adam said the act would further destabilize the system consumers rely on.
“The current payment system is not broken, and it does not need to be fixed,” Adam said. “The CCCA would weaken security, disrupt rewards programs, and benefit a handful of large retailers while consumers and community banks pay the price. Creating new problems is not the solution to problems that simply don’t exist.”