White House economic advisor floats idea of 'Trump cards' amid credit card battle with banks

• Trump's original demand for a 10% interest rate cap by Jan. 20 has been roundly rejected by bank executives and industry lobbyists throughout the week
• Hassett's 'Trump card' concept would narrowly target consumers who lack credit access but have sufficient income and stability to justify credit lines, potentially avoiding the need for legislation
• Major credit card issuers and bank lobbyists told CNBC they have had no discussions with the administration about the 'Trump card' concept despite claims of CEO engagement

White House Floats "Trump Cards" as Alternative to Credit Card Rate Cap

White House economic advisor Kevin Hassett proposed Friday that major U.S. banks could voluntarily offer credit cards—dubbed "Trump cards"—to underserved Americans with sufficient income but limited credit access, signaling a potential retreat from President Trump's earlier demand for a 10% interest rate cap on all credit cards.

Key Developments:

• President Trump called for a 10% credit card rate cap by January 20, a proposal that has been widely rejected by banking executives and industry lobbyists this week
• Hassett, Director of the National Economic Council, told Fox Business the new voluntary program would target consumers in a "sweet spot"—those with stable income but lacking financial leverage due to limited credit access
• The administration expects implementation "won't necessarily require legislation," suggesting banks would voluntarily participate
• Major credit card issuers and bank lobbyists told CNBC they have not yet discussed the "Trump card" concept with the administration

Market Implications:

The shift in approach suggests the White House may be backing away from sweeping credit card industry reforms that could negatively impact consumer spending and broader economic activity. During fourth-quarter earnings calls this week, bankers indicated they would exit the market rather than offer cards at the proposed 10% rate.

Hassett stated the administration has been in discussions with "CEOs of many of the big banks who think that the president's onto something," though industry representatives have not confirmed such conversations regarding the new voluntary program.

The proposed voluntary approach would likely have more limited impact on the credit card sector compared to mandatory rate caps, potentially alleviating concerns about disruption to lending markets and consumer credit availability.