JPMorgan’s Dimon calls credit card interest rate caps a ‘economic disaster’

JPMorgan Chase CEO Jamie Dimon pushed backmost connected calls by the medication of United States President Donald Trump to headdress recognition paper involvement rates, claiming that if Congress follows through, it would effect successful an “economic disaster”.

Dimon made his comments connected Wednesday astatine the World Economic Forum successful Davos, Switzerland.

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Trump has projected capping involvement rates connected credit cards astatine 10 percent for a twelvemonth and has called connected Congress to walk authorities to necessitate it, but helium has fallen abbreviated of outlining a factual program for however the headdress would beryllium implemented.

“It would region recognition from 80 percent of Americans, and that is their back-up credit,” Dimon said connected Wednesday, arsenic Trump renewed calls for the cap.

Banking manufacture commercialized radical The Electronic Payments Coalition claims that if the involvement complaint headdress is imposed, recognition cards for those with recognition scores beneath 740, which relationship for arsenic overmuch arsenic 88 percent of recognition paper holders, could beryllium closed oregon restricted.

Credit paper companies would request to trim rewards for those with FICO scores beneath 760, and would lone request to restrict lending to those with recognition scores beneath 600. Ten percent caps would prevention borrowers astir $100bn a year, according to a 2025 study from Vanderbilt University.

“One of the biggest barriers to redeeming for a down outgo has been surging recognition paper debt,” Trump said.

The comments people a uncommon infinitesimal of bipartisan statement successful Washington.

An improbable alliance

Progressive Senator Elizabeth Warren, a ranking subordinate of the Senate Banking Committee, said past week successful an interrogation with CNBC that the president called her to sermon the anticipation of moving unneurotic connected the proposal.

“Great, let’s get thing done,” Warren said successful the interview.

Trump’s comments echo an existing measure authored by Senator Bernie Sanders of Vermont, which besides caps involvement rates astatine 10 percent, but would past for a longer play of clip and sunset successful 2031. The bill, however, has been sitting stagnant successful Congress. It was astir precocious referred to the Senate Committee connected Banking, Housing, and Urban Affairs successful aboriginal February 2025.

The involvement complaint headdress propulsion comes arsenic an expanding fig of Americans disapprove of the president’s handling of the US economy. A Wall Street Journal canvass released earlier this period recovered that 54 percent disapprove of Trump’s handling of the economy, a sentiment echoed by a caller CNN canvass that recovered that 63 percent disapprove.

“I deliberation we should trial it,” Dimon said. “The authorities tin bash it, they should unit each the banks to bash it successful 2 states, Vermont and Massachusetts [where Sanders and Warren represent], and spot what happens.”

“People crying the astir volition not beryllium the recognition paper companies. It volition beryllium the restaurants, retailers, question companies, the schools, the municipalities, due to the fact that radical volition miss their h2o payments, this outgo and that payment,” Dimon said.

“President Trump is generating a batch of headlines from his recognition paper involvement complaint idea, but we’re inactive waiting for him to make savings for existent people. Last week, helium said involvement rates would beryllium capped by January 20; this week, helium says helium needs assistance from Congress. I deliberation it remains to beryllium seen whether he’s superior astir delivering connected his promise,” Julie Margetta Morgan, president of economical deliberation vessel The Century Foundation, told Al Jazeera.

Political hurdles

Banking executives similar Dimon and Citigroup CEO Jane Fraser person said determination are slim chances of this getting passed by Congress.

Beyond enactment from Trump and progressive Democrats, the measure volition tally into hurdles successful Congress. Earlier this month, Republican House Speaker Mike Johnson said the connection could person “negative secondary effects”.

“The president is asking Congress to walk legislation, truthful he’s not going to effort to personally acceptable recognition rates. That makes it highly improbable we’ll spot a 10 percent headdress enactment successful spot anytime soon,” said Brian Jacobsen, main economical strategist astatine Annex Wealth Management. “It does springiness him an accidental to constituent the digit astatine Congress if it doesn’t happen.”

On Wall Street, recognition paper institution and slope stocks are reasonably mixed connected the heels of Dimon’s comments. Mastercard is down by 1.1 percent arsenic is Visa by 1.7 percent. American Express, connected the different hand, is up 1.9 percent since the marketplace opened connected Wednesday.

Bank stocks are trending upwards. Bank of America is up 0.5 percent, Wells Fargo by 0.1 percent and Citigroup by 1.2 percent successful midday trading. JPMorgan Chase banal is astir adjacent connected the day.