A proposed one-year cap on credit card interest rates backed by U.S. President Donald Trump could reduce borrowing costs for some consumers but also limit credit availability, pressure bank profits and reshape the economics of consumer lending.

President Donald Trump is proposing a one-year cap on credit card interest rates at 10%, arguing that card issuers have taken advantage of consumers with rates that can exceed 30%.

U.S. President Donald Trump said on Sunday (January 11) that credit card companies would be in violation of the law if they failed to comply with his demand by January 20 for a 10% cap on interest rates.

Financial stocks tumbled Monday after President Trump called for capping interest rates on credit cards. Why it matters: An interest rate cap might help consumers who carry balances, but it would bludgeon bank earnings.

A 10% rate cap would make large swaths of the credit card industry unprofitable, especially tied to customers with less-than-ideal credit, banks say.

Stocks in a range of financial companies fell after President Trump called for credit-card interest rates to be capped at 10% for a year, in his latest attempt to address voters' affordability concerns.