Barclaycard limit reduction post covid

onlyfoolsandparking

I'm curious to see what has happened to people's credit limits now the 20th May deadline has passed. My limit is supposed to be reducing from £16800 to £750 on the 20th May, however after logging in today the limit hasn't altered and it is of course 22nd May? don't know about my other card as I didn't bother logging on to that one but seems a little strange to me.

Maybe the reduction will only show properly after my next statement or maybe IF I attempted to spend over the proposed £750 limit it would decline but it's a 'just out of interest' question to see if anybody else's reductions are already showing. Maybe they have 'forgot' to drop my limit/s which would be understandable as they have been very busy dropping so many, lol

I'm tempted to put my £0.79 per month Icloud storage subscription on this card and just that amount each month but I know they won't be bothered and I'm not a big fan of playing those type of games so I'll just close them both when I can be bothered.     
 

creditcardwoes

onlyfoolsandparking said:

I'm curious to see what has happened to people's credit limits now the 20th May deadline has passed.
 

I saw this thread so i checked mine.

Can't believe it. I held two cards with them. One with a £2,700 limit and one with a £4,000 limit. They've closed the one with the 4K limit completely and dropped the limit on the other from £2,700 to £1,000

Just called them up and they couldn't tell me why. They also said they can't consider raising the limit at all for 6 months.

I'm pretty !!!!!! off about it. I'm planning to take out a mortgage in 6 months time, so having the £6,700 aggregate limit with a good track record in terms of utilisation and management was important to me as part of maximising my credit scores with credit reference agencies. 

I've had the accounts for 20 years. Never missed a payment. Always had sensible utilisation, and regularly cleared them to zero balances. I've worked throughout Covid, and even secured a substantial pay rise during that time too, so there is absolutely no rational justification for it. 

A £1,000 limit is about as useful as a turd in a swimming pool. Not sure what to do now. I guess I have to keep the remaining Barclaycard as it will at least report as a long term credit facility on my credit file. But do I now apply for another facility elsewhere to increase my total credit lines on my credit file, or will the negative effect of taking out a new card outweigh the positive effect of having a higher level of well managed credit facilities over the next 6 months?

Barclaycard have right royally screwed me over. The second my mortgage is in place I will cancel the card with them and cut ties that's for sure.

Thrugelmir

creditcardwoes said:

onlyfoolsandparking said:

I'm curious to see what has happened to people's credit limits now the 20th May deadline has passed.
 

I
I'm pretty !!!!!! off about it. I'm planning to take out a mortgage in 6 months time, so having the £6,700 aggregate limit with a good track record in terms of utilisation and management was important to me as part of maximising my credit scores with credit reference agencies. 

The problem with your plan is that mortgage lenders perform their own internal scoring. Your consumer "scores" are totally irrelevant and have little to no bearing on the decision made.  The lender will determine your track record from analysing the 72 months of data that is has access from the CRA's using it's own algorithms. 

kaMelo

Everyone seems to be missing the point here though. Barclays have been slapped with huge fines from the regulator and had to repay money to people whom it deemed had their credit limit's set to high, consequently in perpetual debt because of the too high limits. It's merely Barclays acting in a way the FCA would expect them too as a responsible lender, hence why some new applicants are getting limits of around £200 unless/until they prove their income. They have set the bar high and clearly would rather upset customers than allow more to fall into the "limit set too high" category.
Everyone is taking this way too personally. If you're unhappy move on, there are many more to choose from.
Barclays certainly would not be upset at all those outraged customers closing their accounts, by setting the limits so low it's effectively encouraging you to do so.

Doshwaster

I've got a £6400 limit on a ex-Egg cashback card and only spend about £300 a month on it but I haven't heard anything. If they did reduce my limit significantly then I would have no hesitation of closing the account but the bigger concern is if other banks start doing the same.  

kaMelo

Doshwaster said:

I've got a £6400 limit on a ex-Egg cashback card and only spend about £300 a month on it but I haven't heard anything. If they did reduce my limit significantly then I would have no hesitation of closing the account but the bigger concern is if other banks start doing the same.  

Let's be honest here, credit has been cheap and easy to get for years and people have been generally happy with that. Then along come the complaints about irresponsible lending and mis-sold financial product. I'm not defending the banks for doing so as there is clear evidence it was done to boost profits at the expense of those who could least afford it. 
Under pressure from the regulator along with the financial ombudsman dealing with these complaints there is far more focus on banks being able to prove they did appropriate checks on affordability and lending appropriately according to those checks, if they don't then either the regulator fines them or the ombudsman finds against them in a complaint.

As a result financial institutions are tightening up things, more in depth mortgage affordability, actions over persistent debt on credit cards, cutting overdraft and credit card limits, payday lenders disappearing into administration.  All these things are being done under pressure from the regulator and because so many people complained about being fed easy credit. Now people are complaining because they are not being fed easy credit.
As the old saying goes, "Be careful what you wish for, it may just come true."

Thrugelmir

kaMelo said:

Doshwaster said:

I've got a £6400 limit on a ex-Egg cashback card and only spend about £300 a month on it but I haven't heard anything. If they did reduce my limit significantly then I would have no hesitation of closing the account but the bigger concern is if other banks start doing the same.  

Let's be honest here, credit has been cheap and easy to get for years and people have been generally happy with that. Then along come the complaints about irresponsible lending and mis-sold financial product. I'm not defending the banks for doing so as there is clear evidence it was done to boost profits at the expense of those who could least afford it. 
Under pressure from the regulator along with the financial ombudsman dealing with these complaints there is far more focus on banks being able to prove they did appropriate checks on affordability and lending appropriately according to those checks, if they don't then either the regulator fines them or the ombudsman finds against them in a complaint.

As a result financial institutions are tightening up things, more in depth mortgage affordability, actions over persistent debt on credit cards, cutting overdraft and credit card limits, payday lenders disappearing into administration.  All these things are being done under pressure from the regulator and because so many people complained about being fed easy credit. Now people are complaining because they are not being fed easy credit.
As the old saying goes, "Be careful what you wish for, it may just come true."

Mortgage market review was conducted a few years ago. Then it was pay day loans. The focus has now changed to credit cards. Loose lending practices are being clamped down on. 

kaMelo

Thrugelmir said:

kaMelo said:

Doshwaster said:

I've got a £6400 limit on a ex-Egg cashback card and only spend about £300 a month on it but I haven't heard anything. If they did reduce my limit significantly then I would have no hesitation of closing the account but the bigger concern is if other banks start doing the same.  

Let's be honest here, credit has been cheap and easy to get for years and people have been generally happy with that. Then along come the complaints about irresponsible lending and mis-sold financial product. I'm not defending the banks for doing so as there is clear evidence it was done to boost profits at the expense of those who could least afford it. 
Under pressure from the regulator along with the financial ombudsman dealing with these complaints there is far more focus on banks being able to prove they did appropriate checks on affordability and lending appropriately according to those checks, if they don't then either the regulator fines them or the ombudsman finds against them in a complaint.

As a result financial institutions are tightening up things, more in depth mortgage affordability, actions over persistent debt on credit cards, cutting overdraft and credit card limits, payday lenders disappearing into administration.  All these things are being done under pressure from the regulator and because so many people complained about being fed easy credit. Now people are complaining because they are not being fed easy credit.
As the old saying goes, "Be careful what you wish for, it may just come true."

Mortgage market review was conducted a few years ago. Then it was pay day loans. The focus has now changed to credit cards. Loose lending practices are being clamped down on. 

I realise it doesn't appear this way and my list is not exactly in chronological order but I wasn't suggesting it's happening all at once, now, this is a process that's been going on over the last decade or so. Currently it's Barclaycard cutting credit limits, a few months ago it was Barclaycard increasing minimum payments, just before that it was RBS/NatWest overdraft limits being cut. Who knows what the next one will be.
. 
Complaints historically may have been about loose lending practices and rightly so, now they're about the not so loose lending practices as it appears banks would rather upset customers from being tight with credit than upset the regulator from splashing credit all around without thoroughly checking someone's ability to pay it back.

Doshwaster

Thrugelmir said:

kaMelo said:

Doshwaster said:

I've got a £6400 limit on a ex-Egg cashback card and only spend about £300 a month on it but I haven't heard anything. If they did reduce my limit significantly then I would have no hesitation of closing the account but the bigger concern is if other banks start doing the same.  

Let's be honest here, credit has been cheap and easy to get for years and people have been generally happy with that. Then along come the complaints about irresponsible lending and mis-sold financial product. I'm not defending the banks for doing so as there is clear evidence it was done to boost profits at the expense of those who could least afford it. 
Under pressure from the regulator along with the financial ombudsman dealing with these complaints there is far more focus on banks being able to prove they did appropriate checks on affordability and lending appropriately according to those checks, if they don't then either the regulator fines them or the ombudsman finds against them in a complaint.

As a result financial institutions are tightening up things, more in depth mortgage affordability, actions over persistent debt on credit cards, cutting overdraft and credit card limits, payday lenders disappearing into administration.  All these things are being done under pressure from the regulator and because so many people complained about being fed easy credit. Now people are complaining because they are not being fed easy credit.
As the old saying goes, "Be careful what you wish for, it may just come true."

Mortgage market review was conducted a few years ago. Then it was pay day loans. The focus has now changed to credit cards. Loose lending practices are being clamped down on. 

I'm not sure how reducing limits to £1000 for those who can easily afford much more is an example of clamping down on loose lending practices. If you want to spend over £1000 on a single item by credit card for the consumer protection or other benefit then what are you supposed to do, apply in advance for permission to make the purchase?

NewLeaf1986

creditcardwoes said:

onlyfoolsandparking said:

I'm curious to see what has happened to people's credit limits now the 20th May deadline has passed.
 

I saw this thread so i checked mine.

Can't believe it. I held two cards with them. One with a £2,700 limit and one with a £4,000 limit. They've closed the one with the 4K limit completely and dropped the limit on the other from £2,700 to £1,000

Just called them up and they couldn't tell me why. They also said they can't consider raising the limit at all for 6 months.

I'm pretty !!!!!! off about it. I'm planning to take out a mortgage in 6 months time, so having the £6,700 aggregate limit with a good track record in terms of utilisation and management was important to me as part of maximising my credit scores with credit reference agencies. 

I've had the accounts for 20 years. Never missed a payment. Always had sensible utilisation, and regularly cleared them to zero balances. I've worked throughout Covid, and even secured a substantial pay rise during that time too, so there is absolutely no rational justification for it. 

A £1,000 limit is about as useful as a turd in a swimming pool. Not sure what to do now. I guess I have to keep the remaining Barclaycard as it will at least report as a long term credit facility on my credit file. But do I now apply for another facility elsewhere to increase my total credit lines on my credit file, or will the negative effect of taking out a new card outweigh the positive effect of having a higher level of well managed credit facilities over the next 6 months?

Barclaycard have right royally screwed me over. The second my mortgage is in place I will cancel the card with them and cut ties that's for sure.

If you don't have any outstanding debt this wont' have made a blind bit of difference to your ability to obtain a mortgage. You might be better off obtaining a card elsewhere before the reduced limits reflect on your credit file though as the lower limits might affect your chances with other credit card providers.

Lloyds Platinum at 9.9% APR looks like a good long-term keeper and their website will give you a heads up about the credit limit they're willing to offer you at pre-application stage.