TSB limit decrease

SKMax

I applied and received the TSB platinum credit card with 20 months purchase interest free about 5 months ago. My credit limit was £4000. I used it initially and had an outstanding balance of £725, always paid on time, so no issues with account conduct.
Last week I logged onto their app and saw that they had decreased the credit card limit to £750.
No search carried out on all 3 credit files. I have now paid the balance in full and am tempted to close the card as such a small limit is of no use to me.
Would you suggest I close the account and vote with my feet, I have other cards with limits from £5000 to £13,500, utilization is minimal on all accounts.
I guess I am just surprised they would reduce the limit only 5 months in on the promotional rate, just doesn't make much sense to me !

Ben8282

I believe, although I can't remember where I got this information from, that TSB do review new credit card accounts after 6 months.
It is not readily apparent why the credit limit was reduced in this way. I could speculate that perhaps they wanted you to use the card a bit more, if you only made the one £725 purchase (or multiple purchases totalling £725 in a short space of time) and then stopped using the card and just made minimum payments.
It is good that the card is now repaid.
As to cancelling it, yes of course go ahead if you wish. However, please weigh the following factors before making the decision. If you close the account now, this (closed) account will remain on your credit files for the next 6 years with an age of 5 months thereby reducing average account age. Also be aware that the closed account will show a massive credit limit reduction 1 month prior to it being closed. I think that would be viewed negatively as it is unlikely that you would have requested a credit limit decrease immediately prior to closing an account.

SKMax

Thanks Ben8282

I think you are correct, spend happened in the first 1 month and nothing since, just payments.

Will just hold out and keep as is.

frankenzero

They did this to me as well. 2500 limit reduced to 750 after 2 months of having the card. I closed the account and it's had no negative affect on my ability to get credit. Just got Virgin credit card with a very healthy limit. I'd ditch it personally 750 is no use really.

Money_Rollercoaster

I had a limit reduction on my co-op card years ago, I just rang them and they bumped it back up. You might try that before you cancel.


At the very least, you've got one source of £750 interest free on purchases, which is of some use surely?



Despite the URL, the following MSE link is about credit limits being set low ...

http://www.moneysavingexpert.com/credit-cards/bad-credit-rating

System

Ben8282 wrote: »

As to cancelling it, yes of course go ahead if you wish. However, please weigh the following factors before making the decision. If you close the account now, this (closed) account will remain on your credit files for the next 6 years with an age of 5 months thereby reducing average account age. Also be aware that the closed account will show a massive credit limit reduction 1 month prior to it being closed. I think that would be viewed negatively as it is unlikely that you would have requested a credit limit decrease immediately prior to closing an account.

It's effect will be negligible, if anything giving it up will raise your average credit limit x

SKMax

A quick update to bring this thread to a close and to thank everyone for their response.
I called TSB today and closed the account, the lady who answered the call was very friendly and efficient but did not try to 'save' my business, although I did advise her of the reason. She did offer me a balance transfer promotional rate which I declined obviously.
Anyway, despite the credit limit decrease it was a pleasant experience dealing with TSB !

Candyapple

SKMax wrote: »

I applied and received the TSB platinum credit card with 20 months purchase interest free about 5 months ago. My credit limit was £4000. I used it initially and had an outstanding balance of £725, always paid on time, so no issues with account conduct.
Last week I logged onto their app and saw that they had decreased the credit card limit to £750.
No search carried out on all 3 credit files. I have now paid the balance in full and am tempted to close the card as such a small limit is of no use to me.
Would you suggest I close the account and vote with my feet, I have other cards with limits from £5000 to £13,500, utilization is minimal on all accounts.
I guess I am just surprised they would reduce the limit only 5 months in on the promotional rate, just doesn't make much sense to me !

Almost identical experience with me too - card opened 5 months ago, £5k limit, £2k spent initially and was going to put the next holiday on it when I received a letter a month ago reducing the limit to about £50 above the outstanding balance.

Makes no sense to me either, all payments on time, all other cc balances are low and high limits. I too ended up closing the account, if that's how they want to treat their customers then so be it. I have already applied for the new 30 months 0% purchases card from Halifax and they've given me an ever higher limit than TSB originally offered so win win.