Economic advisor to the White House, Kevin Hassett, mentioned on Friday that major U.S. banks might voluntarily offer credit cards to underrepresented Americans as a way to support President Donald Trump’s initiative on affordability.
A week earlier, Trump urged banks to limit credit card interest rates to 10%, a proposition that has been widely dismissed by industry leaders and their lobbyists this week.
Currently, Hassett, who leads the National Economic Council, is proposing an alternative approach, focusing more specifically on consumers lacking credit access but possessing sufficient income to warrant credit lines.
“They could potentially offer services to individuals who find themselves in that ideal position of not having much financial leverage due to lack of credit access, yet having adequate income and stability to merit credit,” Hassett shared with Fox Business host Maria Bartiromo.
“We anticipate that this won’t necessarily need new legislation, because there will be excellent new ‘Trump cards’ made available to individuals voluntarily by the banks,” he stated.
Such remarks may suggest that the administration is scaling back its ambitions for sweeping reforms in the credit card sector that would be challenging to implement and might adversely affect consumer spending and the economy.
This week, bankers reviewing fourth-quarter performance indicated that instead of providing cards at a 10% interest rate, as Trump has proposed for implementation by Jan. 20, banks are likely to simply close many customer accounts.
Hassett’s remarks were in reaction to a question about whether bankers would have to adhere to Trump’s proposed rate cap, a move that would likely necessitate new legislation.
The administration has been in dialogue with “CEOs of many of the large banks who believe the president is onto something,” Hassett remarked.
A leading credit card issuer and a bank lobbyist representing major lenders informed CNBC that they have not yet engaged in any discussions with the administration regarding the “Trump card” idea.
