Bank of America (BAC) CEO Brian Moynihan said Thursday that U.S. President Donald Trump’s proposal to cap credit card interest rates would slow consumer spending and restrict access to credit.
“If you actually make this a policy, it can re-allocate credit,” Moynihan said in an interview with Bloomberg Television at the World Economic Forum. “That will slow down spending, it will slow down credit availability, and that might not be what you’re trying to achieve.”
Even so, the CEO acknowledged affordability challenges facing consumers, noting his bank has been discussing the topic with the Trump administration.
Earlier in the month, U.S. President Donald Trump called for a one-year cap on credit card rates at 10%, effective Jan. 20, noting that he will not allow Americans to be “ripped off” by credit card firms whose credit card interest rates have reached 20%–30% or more.
Agreeing with Moyniahn’s assessment, JPMorgan Chase (JPM) CEO Jamie Dimon said a rate cap could choke off credit access for most Americans. Wall Street is widely skeptical that such a move will succeed, if history is any guide.