Visa and Mastercard Stocks Drop Sharply on Trump Rate Cap Push

Visa and Mastercard shares took their biggest hit in six months on January 13, 2026, falling more than 4% each in midday trading. The drop came after President Donald Trump voiced strong support for a 10% cap on credit card interest rates and a bill to force banks to use cheaper alternatives to these networks for processing payments.

Background

Credit card companies like Visa and Mastercard have long held a strong grip on the payments market. They process most transactions in the US and around the world, earning fees every time someone swipes a card or taps a phone. Banks issue the cards, but Visa and Mastercard handle the routing between merchants and lenders. This setup brings in billions in revenue from what are called swipe fees.

Average interest rates on credit cards now sit between 20% and 30%. Many people carry balances month to month, paying high interest that helps banks cover rewards programs and losses from defaults. Visa and Mastercard benefit indirectly through more transactions and steady volumes.

President Trump first floated the idea of a rate cap during his 2024 campaign. He aimed it at easing costs for families hit by rising prices. On January 9, 2026, he made it official in a public statement. The cap would last one year, starting January 20, 2026—the one-year mark of his second inauguration. Lenders not following it would break the law, he said.

At the same time, the Credit Card Competition Act returned to Congress. Senators Roger Marshall and Dick Durbin lead the push. The bill would require big banks to offer at least two networks for each transaction. One would have to be outside the Visa-Mastercard pair, cutting into their fee income. Trump threw his weight behind it, calling out the duopoly.

House Speaker Mike Johnson said Congress should look at the rate cap too. This rare mix of bipartisan support and White House backing caught Wall Street off guard. Trading floors buzzed as shares slid.

Key Details

Visa shares fell 4.74% to about $326.50 by midday on January 13. That wiped out gains from recent months. Mastercard dropped even more, down 5.22% to $536.70. Both stocks broke below their 50-day and 200-day moving averages—levels traders watch closely for trends.

The sell-off spread to banks. JPMorgan Chase, Citigroup, Capital One, American Express, and Bank of America all saw declines. These firms depend on interest from card balances to fund perks like cash back and travel rewards.

Stock Performance and Metrics

Visa processes transactions in over 200 countries and more than 160 currencies. It handles over 65,000 per second. Its market value stands at around $635 billion. Even with the drop, its finances look solid: revenue has grown 16.9% yearly over three years, with operating margins at 66%. Return on equity hits 52%. Debt levels are manageable.

Mastercard shows similar strength but faced a steeper fall. Both stocks now trade well below their 52-week highs—Visa down 12.4% from $373 in June 2025. Technical signs point to oversold conditions, but charts warn of more downside without good news.

The rate cap hits banks first. They earn most from interest. Less profit there could mean cuts to rewards or tighter lending. Fewer transactions would then hurt Visa and Mastercard.

"Lenders who do not cap rates at 10% for one year will be in violation of the law." – President Donald Trump

What This Means

Banks may pull back on new cards or raise credit requirements soon. That could slow spending and transaction counts across the board. Rewards programs, popular with millions, face cuts as margins shrink. Critics say this echoes past rules like the Durbin Amendment, which trimmed debit fees and led to fewer perks.

Visa and Mastercard might shift focus. They could push services like data tools or faster settlements using new tech. But their core business—swipe fees—takes the direct blow from the competition bill.

Investors now eye Washington closely. The rate cap needs legal checks; presidents can't always act alone on such rules. Courts may step in. The competition act must pass Senate hurdles.

Banks like JPMorgan or Capital One could signal trouble by hiking credit standards. That would flag lower volumes ahead. For now, stocks sit in oversold territory, tempting some buyers. But the path looks down until regulators clarify.

The payments world built a wide moat around Visa and Mastercard. Populist moves in DC now test that defense. Transaction data from issuers will show early impacts. If volumes dip, networks feel it fast.

Broader markets felt ripples too. Financial stocks lagged as traders sought safety. The sector shifts from growth bets to watching policy fights.

Visa holds a beta of 0.69, meaning less swing than the market. Big investors own 78% of shares. But nine insiders sold in recent months, adding caution.

Analysts still rate Visa highly, with price targets above current levels. Yet sentiment turned neutral amid the noise. The year started with Visa down 5.6% overall.

As January ends, all eyes stay on Capitol Hill and the January 20 date. Legal tests and bill votes will shape the next moves. Banks and networks prepare for tighter times ahead.