To be pissed that Barclaycard decreased my credit limit?

[BusyGreyCat]

Got a notification today that Barclaycard has decided to lower my credit limit, and honestly, I’m pretty annoyed. I haven’t missed any payments, and my credit score is fine, so this feels like it came out of nowhere.

AIBU to think it’s unreasonable for credit companies to make changes like this without any warning? Has anyone else had this happen recently? I get that they’re trying to manage risk or whatever, but it feels like a punishment when I’ve done nothing wrong.

What would you do in this situation? Any tips on getting the limit restored, or should I consider moving to a different provider?

They did a purge a couple of years ago and reduced my limit from £10k to £250! I told them to shove it, what’s the point of a credit card you can’t even use to book a holiday?

My Barclaycard just sat doing nothing so they lowered my limit and then closed it this year. It's just part of responsible lending practices to review limits and such. If you don't use it to the limit then there's no need for them to have the risk that at some point you'll whack a huge purchase on.

If you want to keep the limit give them a call.

It’s probably because you don’t max it out and as a result they don’t make enough money of you to counterbalance the perceived risk of allowing you the credit.

Barclaycarc did this to me last year but I had the option of saying no and keeping it as it was. I recall I had to text them something and they left my limit the same. I rarely use the card.

Banks have been doing this for years - they are a business and they are making little if any money out of you. I'd shop around for a card with cashback rewards etc

Well that sounds like the action of a very responsible lender, increasing the amount of credit you have available without establishing whether you have a need for it 🙄

It may well be a business decision by Barclaycard. If they have promised to lend you £10k but you're only borrowing £1k, then there's £9k of credit that they can't give to someone else. If they reduce your limit to £5k, then it still more than meets your needs; but they also can sign up a couple of new people for £2.5k each.

It doesn't sound like you've tried ringing them and asking them to restore the limit, so that's my tip - it's a bit basic and boring but I don't really understand why you wouldn't do that, given how strongly you seem to feel about it.

Weirdly Barclays reduced mine from 10k to £5,050 which seems to be an odd number. They did it a few years ago now.
I, like you always paid it off, but liked to have a big cushion for emergencies and if I had a balance of nearly 5k I'd have no cushion.
I've had the same card since I was 18, I'm now retired.

Very similar to what happened to me @BusyGreyCat - also with barclaycard credit card. Dropped my credit limit from £4k to £1100 with no explanation.

Mine is a 0% interest for 22 months. I use it for a small number of transactions but they are usually quite high amounts (holiday etc) and pay it off over a few months. Wanted to book flights and £1100 is not enough so I phoned up and a very unhelpful chap basically said “no, we cannot increase your credit limit” - when I asked to speak to a supervisor/for an explanation, again the answer was no.

So now that I’ve paid it off, I’ve cancelled it and am waiting my new M&S one to arrive with £5k limit.

It could be this... overall your affordability has decreased because the other card has increased your credit limit.

I would contact them. I think they do these things because they think they are being helpful.😒 NatWest did similar to me on by reducing my overdraft limit on an overdraft I had never used. More or less said that thought I did not need it. Unless you income has dramatically reduced, I expect Barclays had the same reason.

I’m sure this happened to me once just because I wasn’t using it.

It matters because it’ll affect her credit rating. Credit rating companies don’t like you using more than 25% of available credit. So using £1000 of a £4000 limit, fine. But if limit is dropped to £2000, she’s now using 50% - not fine

I think that’s why Barclaycard did it to me. I kept it for emergencies.

I was going to say this. If they see you have increased credit limit elsewhere maybe their criteria is that you can afford the sum of the 2 current credit limits and they therefore needed to decrease their limit to stay within their criteria to lend to you at all. They are all connected now you have this running credit references

Are you persistently in debt with them? Even if you're within your limit, if the overall balance isn't actually decreasing over a long period they are meant to act to protect you falling into hardship. One of the levers they pull to do this is to reduce your limit overtime, as you make a payment and lower the balance.

More often than not, it’s cos you haven’t been seen to be using it as much. I know so cos it happened to me. I had a 15k dropped to 2.

That might be why - you'd be too exposed with all of the credit available to you.

My overdraft limit was reduced, but that was probably because I'd built up significant savings, never gone anywhere near needing it - and they wanted to flog me unsecured loans for many thousands more instead.

Barclays withdrew my overdraft facility completely because I never used it. Clearly that makes me a massive risk! But I wanted it there as a backup in case of emergency.

I now bank with Nationwide - who also have better interest rates on their savings accounts.

I mentioned in a previous comment that I pay the balance off in full every month.

If you aren’t using it they often reduce the limit
just go somewhere else, or ask them to review the limit

it’s part of responsible lending I believe where limits are reviewed and if they aren’t used they may reduce a limit

What do you need the limit for? It could be related to the increase that you had with your other provider. Bringing your overall lending to something that is seen as unaffordable.

Surely this notification is the warning?

But I do understand it's rather annoying in the circumstances you describe.

Amex keeps randomly increasing my limit every couple of years. It's now over 10k and, honestly I don't even remember ever borrowing more than a couple of grand. 99% of the time I pay my bill in full at the end of the month. Would definitely look I to it if credit limit is important for some reason.

Oops, quoted the OP. Sorry...

If you pay it off in full every month, & don’t ever get close to the existing limit .. you are essentially not a good customer in that they make no money from you! They have a certain level of credit that they can extend across their client base .. they’d prefer to use it on customers they can make money from