Credit limit reduced, incurred Over Credit Limit Charge

EssentialParadox

I took advantage of a balance transfer offer to move £3,000 to a Barclaycard with a limit of £3,500. A couple of months later, they lowered my limit to £2,500 without warning, which listed me as being over my credit limit, and they issued me an 'Over Credit Limit' charge of £12.

Is this normal, can I argue against it? It doesn't quite seem fair.

CKhalvashi

EssentialParadox wrote: »

I took advantage of a balance transfer offer to move £3,000 to a Barclaycard with a limit of £3,500. A couple of months later, they lowered my limit to £2,500 without warning, which listed me as being over my credit limit, and they issued me an 'Over Credit Limit' charge of £12.

Is this normal, can I argue against it? It doesn't quite seem fair.

Complain to them, then complain to the FOS.

The banking code mentions that credit limits should not be reduced to trigger a charge (I don't have a copy in front of me, but I do recall this much).

At the same time, if I've had a limit reduced, I normally run the balance reasonably close for a few months, then ask to increase the limit. Just done this with HSBC, popped into a branch, and they've asked me if I need any additional borrowing. :eek:

It works.

CK

EssentialParadox

CKhalvashi wrote: »

Complain to them, then complain to the FOS.

The banking code mentions that credit limits should not be reduced to trigger a charge (I don't have a copy in front of me, but I do recall this much).

At the same time, if I've had a limit reduced, I normally run the balance reasonably close for a few months, then ask to increase the limit. Just done this with HSBC, popped into a branch, and they've asked me if I need any additional borrowing. :eek:

It works.

CK

Thanks!

They said they'd refund me the charge as a 'gesture of goodwill' but I complained that I should not have received the charge in the first place. Whether they'll take notice or not… *shrug*

Daedalus

EssentialParadox wrote: »

Thanks!

They said they'd refund me the charge as a 'gesture of goodwill' but I complained that I should not have received the charge in the first place. Whether they'll take notice or not… *shrug*

Gesture of goodwill = we were wrong.

First rule of life is to never admit guilt unless you have to. Same rule applies to business.

garynuman

Also, if you go over your credit limit on a promotional deal you normally lose the 0% and will end up paying the normal rate! They may have refunded the charges but you may now no longer be on 0%!

Maybe worth double-checking your statements or contacting them to confirm that you are still on 0%

EssentialParadox

garynuman wrote: »

Also, if you go over your credit limit on a promotional deal you normally lose the 0% and will end up paying the normal rate! They may have refunded the charges but you may now no longer be on 0%!

Maybe worth double-checking your statements or contacting them to confirm that you are still on 0%

Thanks for the heads up! I've made a note to double check my next statement

Gromitt

EssentialParadox wrote: »

Thanks for the heads up! I've made a note to double check my next statement

I'd contact them before your next statement, best not to get the charge than trying to get them to remove it afterwards.

EssentialParadox

Ooh… I actually did get a response to my complaint (was doing it via email, rather than phone).

After they removed the £12.00 charge as "a gesture of goodwill", I'd responded with:

"I believe that the UK banking code mentions that credit limits should not be reduced to trigger a charge, which is what happened in this case.

As such, it should not be merely a "gesture of goodwill" on your part to refund that charge, but it is your responsibility to not even make that charge in the first place.

As a gesture of goodwill in this case I will not be reporting this instance to the UK Financial Ombudsman Service. I do recommend you keep track of your systems in future to ensure Barclaycard stays on the right side of the law."

They responded with a very long apology and informed me the promotional rate on my account had actually been withdrawn (before I'd even made a point to ask) and said they've now returned it, and they also surprisingly re-increased my larger credit limit (which I didn't expect at all). They also offered to escalate the complain if I was unsatisfied.

Overall, even though it's over something that shouldn't have happened in the first place, the response to a complaint with Barclaycard is pretty outstanding compared to what I've had to go through with other banks! :j