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Alex
@asenderling.eth
"Credit card companies hate him for this one trick!" Effectively what this would mean is that 90% of the country will lose access to credit cards lol https://x.com/BehizyTweets/status/1836565850687406158
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Jared 🎩
@javabu.eth
I'm actually supportive of this policy. I think there should be a limit on the amount of interest credit card and payday loan companies can charge. Why do you believe that 90% of the country would lose access to credit cards?
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simon
@sa
10% cap means 750+ credit score for most people to qualify and much lower limits. Also, this would be an absolute nightmare to implement.
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Gwynne Michele
@thecurioushermit
Because the credit card companies base their rates on credit risk. If they can't charge above 10%, they'll tighten up who they give credit to.
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Alex
@asenderling.eth
The interest rates on these cards are so high because they're technically mini uncollateralized loans. If you don't pay the cc company back they don't usually have an asset they can reclaim (like in the case of a mortgage). Rates then become a function of risk where the cc companies have to calculate what rate they charge where the $ they make from interest payments outweighs the amount of $ they lose from defaults/fraud/theft. If you were to cap rates at 10%, cc companies would have to eliminate any customer who presented even a slight risk of defaulting, they'd only be able to supply credit to the most qualified of users and might even need them to put up some kind of collateral. You'd probably also see a major decrease in credit limits.
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