U.S. Treasury Examines Impact of Credit Card Rate Caps on ABS Market

U.S. Treasury Secretary Besent stated that the Treasury Department is currently studying the potential effects of credit card interest rate caps on the asset-backed securities (ABS) market. According to Jin10, this examination is part of a broader effort to understand how regulatory changes might influence financial markets. The focus is on assessing how these caps could impact the issuance and performance of ABS, which are financial instruments backed by credit card receivables. The Treasury's analysis aims to ensure that any regulatory adjustments do not inadvertently disrupt the stability or liquidity of the ABS market. This initiative reflects ongoing concerns about balancing consumer protection with market health.