Congress Weighs Bill to Shore Up Interstate Bank Lending

Congress enacted the Depository Institutions Deregulation and Monetary Control Act of 1980, or DIDMCA, to let state-chartered banks apply interest rates permitted in their home states when lending nationwide, giving them parity with national banks. The framework is under pressure as inflation and credit-card delinquencies sharpen scrutiny of borrowing costs. The dispute pits state authority to protect residents from high-cost credit against concerns that divergent rate rules could fragment interstate lending and weaken the U.S. dual-banking system.

The immediate fight stems from Colorado’s HB 23-1229, whose opt-out took effect July 1, 2024; separate provisions cut the acquisition charge on loans of no more than $1,000 to 8% from 10%. On April 2, 2026, the U.S. Court of Appeals for the Tenth Circuit vacated a 2-1 panel ruling and granted en banc review. Congress is also considering the American Lending Fairness Act: S. 3889 was introduced Feb. 12 and H.R. 7866 on March 9, limiting state opt-outs to banks they charter.