Key Takeaways Senators Bernie Sanders and Josh Hawley introduced a bill last week that would cap credit card interest rates at 10%.Banks said a cap that low would significantly decrease the number of people it could issue credit cards to.

Factors like your debt-to-income ratio, your income and existing debt all influence the interest rate on your credit card. And consumers who are considered high-risk are approved with a higher interest rate as a way for banks and issuers to compensate for the possibility of default.

Josh Hawley, Bernie Sanders Propose Capping Credit Card Interest Rates At 10%

Sanders and Hawley’s bill comes after President Donald Trump vowed in the 2024 race to temporarily cap credit card interest rates at 10%.

One big problem with credit cards is if you keep using them for purchases, you may never pay off your debt. Personal loans, on the other hand, come with a fixed interest rate, a fixed monthly payment and fixed repayment schedule that dictates the exact date you’ll pay off your debt for good.