By bizn_fun 
Some analysts and economists agree that a cap, on its own, might not benefit consumers as much as Trump and lawmakers across the political aisle claim.
“A 10% cap may not be the right solution because the people that are already in trouble, that’s not necessarily going to help them,” said Schmidt of Exchange Capital Resources.
Benedict Guttman-Kenney, an assistant professor of finance at Rice University, said banks might respond by limiting how much they lend to people with lower credit scores, who are considered higher-risk borrowers. Those are the people most at risk of losing access to credit cards, he said.
Banks, he added, might also try to recoup their revenue elsewhere, like by raising annual fees or late fees.
“It’s not clear that people are going to be better off,” Guttman-Kenney said. “They’re still paying similar amounts of money.”
But he noted that some bank expenses are “bloated”, meaning they have room to cut costs to keep their margins intact. They could, for example, trim down how much they spend on marketing, he said.
And a recent Vanderbilt University study found that Americans would save roughly $100bn a year in interest costs if a 10% rate cap were to be implemented.
“This is something people would see, they would notice, they would feel it,” said Brian Shearer, a researcher at Vanderbilt’s Policy Accelerator and the author of the study.
“This alone would impact their household budgets substantially.”
Shearer questioned a key argument put forward by bank executives and their lobbyists: that any reduction in rates will necessarily lead to a reduction in lending. He pointed to banks’ robust margins in the credit card market.
Interest payments, he added, do not account for the majority of the revenue that banks earn on credit cards.
“No policy is without some pros and cons,” Shearer said. “To continue lending, banks would have to reduce rewards to some extent, especially to people with lower FICO scores (credit scores).
“However, the savings from interest, even to those people who lose some rewards, would far exceed the lost rewards.”