To think banks shouldn't be allowed to do this?

[moutonfou]

I've always paid off my credit card fully every month and never accrued interest.

A few months ago I made to the decision to buy a holiday on credit and pay it off over the next few months, thereby accruing a small amount of interest each month, but it suited me as a way of paying.

Yesterday I got a letter out of the blue announcing that my credit limit was being increased by £1000.

So they are deliberately targeting users who (in their eyes) are having more difficulty paying off the balance, and giving them more credit? AIBU to think that's shocking?

I've made my point FlowerPot, repeating myself isn't going to help.

pipistrell
I've made my point FlowerPot, repeating myself isn't going to help.

Ah, I see.

I don't know how you think the cc company can make money out of people who pay in full each month of course they want, in fact need people not to

They get a percentage of every transaction from the retailer plus annual service charges. Obviously the interest they charge on uncleared balances is large part of their revenue but it is not their only revenue source.

But the percentage has reduced massively, due to EU regulation, over the last year or two so I can see that this has probably seriously affected credit card company revenues.

There are also proposals to limit the total amount of interest that a company can charge - currently, if you run up £1000 in debt at 20% interest and then pay the minimum until the debt is paid off, it will take over 18 years to do so and cost over £1300 in interest on top of the original £1000. I think they are suggesting that the interest cannot exceed the amount spent.

www.moneysavingexpert.com/credit-cards/minimum-repayments-credit-card#calc

Without high interest charges, the current business model for credit cards is probably unsustainable and will probably change for the worse from the customer's perspective over the coming years.

They've already cut cashback bonuses so they might start increasing interest and charges or reintroduce annual fees for simply holding a card.

We pay our credut card bill in full every month - and have jusr been rewarded by having our credit limit REDUCED. desn't actually bother us as we never get nywhere near it. And it means less for the bad people to scam out of us!

I think YABU. Although you're not paying it off in full, you're still making well above the minimum payments right? Which means you obviously can afford to borrow more. Now from your bank's point of view, if they don't offer you that credit limit rise and you did want more credit, someone else will, and then they'll lose out.

As long as you feel you can be disciplined, you should accept the limit rise, you might need it in future.

We buy everything on credit cards. We're intelligent enough to use it to our benefit and not get ourselves into any trouble.

For example, we bought a car with one card (paid off in full within a week) and the air miles gave us a holiday.

You don't have to use the large amount offered and it's easy to reduce the maximum if you'd like.

For years I went into my overdraft each month & the bank increased it to a stupidly high amount.

Since September we got rid of a major outgoing & our account is well in credit. A couple of weeks ago I got a letter saying my overdraft is being reduced.

Go figure.

This is one of the most successful world economies.

I mean, the US had the most successful economy and it wasn't bulletproof, nor would anyone advocate the practices that went on there in the lead up to 2008.

They are just trying to make money (not that easy in the era of low interest rates), it's not like they are forcing anyone to use the extra credit. For some people that may actually prove very useful in the event of sudden cash flow issues and they would like the extra credit. Stop being so paternalistic.

^^ and if anyone wants to know what caused the global slowdown in 2008 - there you have it

I should probably do what drums does above but the year I did use my credit card for most things I just didn't like it psychologically even though I repaid it each month and even though not using it now means I waste the credits, cash, air miles etc I otherwise might get. I decided no matetr how much better off financially I might be using a credit card it did not suit me so I don't. It's silly reaslly because although I check my bank account twice a day I could do the same with the credit card and just do a subtraction sum to know the effective current account balance but it did not feel the same to me.

It's like blaming the supermarket because you're fat. Oh, wait...

It's like blaming the supermarket because you're fat.
Actually it is very well known that all the extra large packets (mars bar, crisps, ready meals etc) as well as the flavour enhancers (used in the Pringles for example) that make you eat and eat way past the point when you are not hmgry anymore have a big part to play in the epidemic of obesity...

In which case, I wouldn’t blame the supermarkets but I would blame the food manufacturers that are doing their best to make us eat more than we wouod. It’s actually part of the product design fgs...

Ummmm no. No-one makes you eat (unless they've put a fun to your head, obvs).

As someone who has had loads of debt in the past, I disagree with you, OP.

The banks didn’t make me take out multiple loans, overdrafts, and credit cards. That was all me being reckless with credit. If you don’t know how to manage money, or have no self control, that’s not the banks fault.

I will say, though, that I have learned my lesson. I have 4 credit cards, and one of them has just had its limit increased, but I make sure I never have more than 200 on each card, and I actually have some savings now. I am much better with money now as I know what it is like to struggle, and I don’t want that to happen again.

*gun