The UK doesn't have a cap on credit card interest rates. Over the years there have been proposals for one, and since 2018 the FCA has had rules to help people who pay a lot in interest over a long time without reducing what they owe. This article explains both.

ClearScore is a credit broker, not a lender.

The 2017 Labour proposal

In 2017, while in opposition, the Labour Party (through the then shadow chancellor, John McDonnell) proposed a "total cost cap" on credit cards. Under it, nobody would pay more in interest and fees than the amount they had originally borrowed. It was modelled on the cap the FCA introduced for payday loans in 2015, which limits total charges to 100% of the amount borrowed.

The proposal wasn't introduced. Labour has been in government since July 2024. When we checked in October 2026, we didn't find any current government proposal for a credit card interest cap.

The FCA's persistent debt rules

The FCA published rules on persistent credit card debt in February 2018, and card providers had to follow them from 1 September 2018.

You're in persistent debt if, over 18 months, you've paid more in interest, fees and charges than you've paid off the amount you borrowed. In 2018, the FCA said customers in persistent debt paid on average around £2.50 in interest and charges for every £1 of borrowing they repaid.

Under the rules, card providers must:

• At 18 months: tell you you're in persistent debt and encourage you to pay more, if you can afford to.

• At 27 months: contact you again if nothing has changed.

• At 36 months: offer you a way to repay your balance in a reasonable period. If you can't afford that, they must treat you with forbearance, which can include reducing, waiving or cancelling interest and charges. They may also suspend or cancel your card.

Credit limit increases

Card providers also agreed in 2018 to let customers opt out of automatic credit limit increases, and not to offer increases to people who have been in persistent debt for 12 months. The FCA estimated this would mean around 1.4 million accounts a year wouldn't receive such offers. You can usually ask your provider not to increase your limit without your agreement.

Consumer Duty

Since July 2023 (and since July 2024 for older, closed products), the FCA's Consumer Duty has required financial firms, including card providers, to show that their products offer fair value and to avoid causing foreseeable harm to customers.

How long minimum payments can take

Credit cards cost more to borrow on than most other types of credit, as you can see in the following chart that shows typical credit card interest rates compared to personal loans:

The rate you're offered also depends on your credit history.

Among ClearScore users approved for a credit card in early 2026, the median APR was 39.9% for scores up to 399, falling to 26.9% for scores of 800 or more. Many other factors affect the rate you're offered.

Minimum payments are often low, and a large part of each payment goes on interest. Here's an example of a £3,000 balance at a 24.7% interest rate, with no further spending:

Our calculation. Interest is charged monthly at 24.7% ÷ 12, and minimum-payment rules vary between card providers.

Eligibility and acceptance are decided by each lender and depend on its own criteria and checks. Checking your eligibility does not guarantee that you'll be accepted.

Help with credit card debt

If you're struggling with repayments, contact your card provider. Free, confidential debt advice is available from StepChange, National Debtline and Citizens Advice.