Klarna CEO backs Trump 10% rate cap, calls credit cards ‘extraction machine’
Klarna CEO Sebastian Siematkowski explains why he supports President Donald Trump’s push to lower credit card interest rates to 10% in ‘The Claman Countdown.’
Klarna CEO Sebastian Siematkowski expressed support for President Donald Trump’s campaign to reduce credit card interest rates to 10% during an interview with “The Claman Countdown” on Monday, despite much opposition from the banking industry.
“Credit card interest is nothing more than a drag machine,” says Siematkowski. “I think President Trump is very smart and willing to take on the banks on behalf of the American consumer.”
President Trump has called for a 10% cut in credit card interest rates. Tuesday marks the deadline for credit card companies to respond to the proposal.
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President Donald Trump takes questions from members of the media aboard Air Force One on Jan. 11, 2026, on his way back to the White House from Palm Beach, Florida. (Samuel Corum / Getty Images)
FOX Business host Liz Claman noted that a federal cap like this one would likely require Congress to pass legislation to make it legal.
But Klarna’s CEO argued that American consumers are increasingly fed up with the industry’s “unfair” practices.
“They are tired of these tricks they used to use credit cards, they are looking for healthier alternatives,” said Siemiatkowski.
He argued that the credit industry’s “broken system” has led to excessive costs for American consumers.
“$160 billion in interest costs last year, 31 billion Americans are paying in these funds. That’s not a financial services industry. It’s an extraction machine. So, it’s not necessary to charge such high interest,” he said.
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Shares of Visa and Mastercard tanked after the president’s announcement. (FREDERIC J. BROWN/AFP via Getty Images)
Siematkowski’s position is at odds with many credit card issuers, who say the interest rate caps can limit access to credit, especially for low-income borrowers.
Many of them predict a cap like this will eliminate debt for those consumers. However, Siematkowski said the warnings are not supported by what has happened with rising prices overseas.
“In some European markets, there are interest rates,” he explained. “It does not lead to these results that the banks are trying to scare.”
The CEO also argued that high credit card fees drive up prices for customers, even those who don’t use credit cards.
“Because merchant fees and credit card fees are so high, consumers and stores have to charge higher fees on average, even for people who pay with cash,” Siemiatkowski said.
Sebastian Siematkowski, CEO and founder of Klarna Holding AB, speaks during an interview at the New York Stock Exchange on Wednesday, September 10, 2025. (Michael Nagle/Bloomberg via Getty Images)
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“That’s not a good system for the community. It’s also a wrong system,” he added.
Siemiatkowski said the stricter regulations Trump is proposing could restore balance to the credit industry.
“Strengthening things with requirements like these can be life in an industry that has lost direction,” he said.
