Why The SoFi CEO Is A Big Fan Of Trump's Proposed Credit Card Interest Rate Caps

One common credit card mistake is using cards with high interest rates, which entails paying lots in interest when you're carrying a balance. However, many people still accept higher-interest cards because of the cash back or points they can earn. And once they start carrying a balance, those high interest rates can make it difficult to escape the debt accumulated on the card.

In an effort to reduce the stress of credit card debt and lower the cost of living, in a recent Truth Social post, President Trump called for a 10% limit on the interest credit card companies can charge consumers on their carry-over balances. The 10% cap proposal would last for one year. Although credit card interest rates go up and down regularly because of factors like changes in the federal funds prime lending rate, the current average credit card interest rate is just below 20%, according to Bankrate. People who pay above-average rates are typically forced to do so because of missed payments or high balances.

Although Trump's proposal to cut the rate nearly in half for a year has some supporters and some detractors, one somewhat surprising proponent is SoFi CEO Anthony Noto. In a post on X that followed Trump's announcement, Noto wrote, "Credit card issuers simply won't be able to sustain profitability at a 10% rate cap. Consumers, however, will still need access to credit. That creates a large void — one that SoFi personal loans are well positioned to fill." It's worth noting that Trump's idea would need ratification by Congress.

SoFi is a digital bank that offers personal loans, investing options, and general banking accounts. SoFi's personal loan amounts range from $5,000 and $100,000, and you might receive an answer about your loan application on the same day you submit it. What you need to understand before you get a debt consolidation loan (or a personal loan) is that you could pay up to 7% in origination fees, which can reduce the final amount you get. According to SoFi, the digital bank doesn't charge these fees automatically; instead, it gives borrowers an option to get a loan with an origination fee but pay less in interest.

Considering SoFi interest rates typically start at about 8.75% and current credit card rates average about 20%, it might be surprising that SoFi's CEO is in favor of Trump's idea to drop credit card interest rates to 10%. Such a drop could weaken the advantage personal loans have over credit cards — lower interest rates. However, Noto and other industry experts believe the cap on interest rates may cause credit card companies to reduce the amount of credit they make available, which could lead consumers to companies like SoFi. 

A study in late 2025 from Vanderbilt University Law School found that Americans could save $100 billion in interest payments annually if the credit card interest rate was capped at 10%. However, banks will almost certainly take steps to make up for lost profits. Credit card issuers might significantly limit the rewards programs they offer or increase fees, for example. 

Per College Scholarships, those who obtain loans successfully from SoFi tend to have good credit scores ranging from 680 to 850, with an average score of 730. Meanwhile, the average American's credit score is 715, according to FICO. If people with lower scores cannot obtain credit cards and fail to qualify for SoFi loans, they might pursue riskier borrowing options, such as turning to payday loans, no-credit-check loans, and car title loans. The terms on these loans are generally worse than what credit cards offer.

In a joint statement with multiple banking associations, the American Bankers Association stated that card issuers would almost certainly pull back on the amount of credit offered. "Evidence shows that a 10% interest rate cap would reduce credit availability and be devastating for millions of American families and small businesses who rely on and value their credit cards, the very consumers this proposal intends to help," the joint statement said.