Chamath Palihapitiya Calls Proposed 10% Credit Card Interest Rate Cap 'Disruptive' As Trump, Sanders, And Lawmakers Push For Reform

Billionaire investor Chamath Palihapitiya believes a proposed 10% cap on credit card interest rates would significantly disrupt the financial services industry while potentially benefiting consumers.

What Happened: “This would be phenomenally disruptive,” Palihapitiya wrote Sunday on X. “Would force everyone who can embrace ultra low cost rails to emerge. Incumbents would be in trouble for sure.”

Palihapitiya was responding to news that Congresswoman Anna Luna (R-FL) is working with Rep. Alexandria Cortez (D-NY) on legislation to cap credit card interest rates at 10%.

His comments come as President Donald Trump and Sen. Bernie Sanders (I-VT) have independently supported similar proposals. Sanders announced plans to introduce legislation backing Trump’s 10% cap idea.

This would be phenomenally disruptive. https://t.co/3mb8fZfyh3

— Chamath Palihapitiya (@chamath) March 9, 2025

I think opposite. Would force everyone who can embrace ultra low cost rails to emerge. Incumbents would be in trouble for sure.

— Chamath Palihapitiya (@chamath) March 9, 2025

The initiative gains significance as credit card defaults reach their highest levels since the 2008 financial crisis. U.S. credit card lenders wrote off $46 billion in seriously delinquent loan balances during the first nine months of 2024, a 50% increase year-over-year, according to BankRegData.

See Also: Stock Futures Drop As ‘Reverse Trump Trade’ Takes Hold—Peter Schiff Says Market Shift ‘Long Overdue’ And Will Likely Continue For A Decade

Why It Matters: While Palihapitiya acknowledged he “generally hate[s] price controls,” he expressed support for “ultra low cost rails in financial services.” His view contrasts with industry warnings that such caps could restrict credit access for lower-income Americans.

Capital One Financial Corp. COF, the nation’s third-largest credit card lender, reported its credit card write-off rate increased to 6.1% in November, up from 5.2% a year ago.

The current average credit card interest rate stands at 21.5%, according to Federal Reserve data, more than double the proposed cap.

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