Big U.S. banks are gearing up to challenge former President Donald Trump's proposal to cap credit card interest rates at 10%, warning that the move could have serious economic consequences. Industry leaders, including JPMorgan Chase, argue that such restrictions could backfire by limiting access to credit for millions of Americans and slowing down consumer spending.

Under the current system, banks have the flexibility to adjust interest rates based on factors like creditworthiness and risk. Trump's plan would upend this model, forcing financial institutions to overhaul their lending practices. "Everything's on the table," JPMorgan Chase executives said, signaling that a fierce lobbying effort or legal battle could be on the horizon if the proposal gains traction.

Critics of high credit card rates have long argued that they disproportionately impact lower-income households, trapping them in cycles of debt. Trump's initiative appears aimed at addressing these concerns, but banks warn the unintended consequence could be fewer credit cards issued, as lenders scale back on higher-risk applicants to protect their profit margins. This could result in a significant number of Americans losing access to convenient credit options for everyday purchases and emergencies.

Financial experts also fear a ripple effect across the economy. Reduced credit issuance could dampen consumer spending—an essential driver of the U.S. economic engine. With inflation still weighing down households, tighter credit availability might make it harder for families to stay afloat and for businesses to maintain their sales.

For banks, the stakes are high. Credit card revenue generates billions annually and forms a core part of their earnings. A government-imposed rate cap would likely squeeze profit margins and force institutions to reassess their lending strategies. JPMorgan’s declaration that “everything’s on the table” hints at the seriousness of this challenge, as the financial sector prepares to push back through lobbying, legal action, or even public campaigns.

The debate underscores the tension between consumer protection and maintaining robust financial systems. While a cap may help certain Americans avoid crippling debt, it risks cutting off access for others, disrupting commerce and banking alike. As politicians, banks, and advocacy groups prepare to weigh in, the outcome could reshape how Americans use and rely on credit cards in the years to come.