PPI claim successful but today they have reduced my credit limit

gamakly

Hi,

First of all thanks to Martin Lewis for the templates which enabled me to make a successful claim against Barclaycard (Goldfish at the time I first took the credit card). I have been awarded £2205 which they informed they would add to my account then withdraw it and send the sum to me as a cheque or bank transfer.
I noticed yesterday the sum was added to my account two days ago but so far hasn't been withdrawn.
Today I received a text from Barclaycard asking me to call them. They informed me that my credit limit has been reduced by £2000.
A year ago I had severe financial stress and asked for patience from my credit card companies. Naturally this affected my credit rating. Nevertheless I got my finances back on track, repaid arrears where it was required and have made my payments every month since then. Once or twice I have been a little late in repayment but have had no demands except a couple of late payment charges.
Essentially they are taking back the money they are paying me. What can I do? Can I take this to the ombudsman to make a complaint because it's too much of a coincidence that they are reducing my credit limit by the same amount as my PPI award?

misschicken

Have they actually said they are now not transferring the £2205 to by cheque/bank transfer?

Generally if you're not in arrears on your account they don't usually apply the settlement to the debt.

And a lot of credit cards are reducing credit limits as a matter of course.

If you're not in arrears and they have applied it to the amount outstanding then I'd speak to the FOS but find out exactly what they're doing first.

dunstonh

Essentially they are taking back the money they are paying me.

Not really as they are reducing your debt. So, you are still getting it.

What can I do?

The limit on a card is at the discretion of the lender. You admit you have had financial problems. So, they are allowed to reduce the limit. The fact you had a PPI refund is not the direct cause of the reduction. They have probably had a system notification on there to reduce the credit limit as soon the balance drops. The refund probably triggered it automatically.

Can I take this to the ombudsman to make a complaint because it's too much of a coincidence that they are reducing my credit limit by the same amount as my PPI award?

The FOS does not rule in commercial decisions. Had your account been run well for the last year or so then you would have a strong case. However, with it being run badly, they can use reduce your limit and would appear to have good reason for doing so.

I would suggest you discuss this with BC first.

gamakly

They haven't suggested they are keeping the money yet, just that my limit is being reduced. Yes, I agree that it comes off the overall debt but I was hoping to spread the money amongst my other cards and to keep me going through the summer months because I am a self employed teacher.
I am still waiting for a call back from BC to discuss it further.

gamakly

Have spoken to Barclaycard and they have agreed to keep my limit as it is. Thanks for your advice. Dunstonh, looks like you were right in that it kicked off an automated response. If anyone else has this problem I would say keep calm and polite and explain your position and your plan to reduce your debts.

dunstonh

Good result. You handled it well from your response. Being calm and polite to begin with it usually the best stance as you want the person you are speaking with to be on your side. Not to alienate them.