Barclaycard limit reduction post covid

[Deleted User]

Doshwaster said:

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?

They have to judge it based on your usage etc, someone with £10000 limit who spends £20 a month doesn't look like the sort of person who will need to spend £1000+ on an item so they reduce the limit if they rebalance your risk. Benefits aside, you only need to spend 1p on a credit card for S75 cover, provided the item meets the other criteria.
Yes, you can apply in advance for an increase or argue if they say they will reduce your limit. Realistically speaking, people who use the cards regularly and pay off in full and have great credit history aren't having their limits reduced. I spend less than 20% a month of my credit limit on my main card, usually less than 10% and increased the limit by £1000 twice in the last 12-18 months, can't remember exactly. My supermarket card is maybe 25-30% of the limit monthly, hasn't been touched. My two BT cards, one with Barclays has been increased a couple of times but I am paying it down monthly and haven't used a transfer for a while, the other was a one off transfer period low fee with no further offers which again I am paying down and will probably close after it's done as there will likely be better offers available if I need them.

Shakin_Steve

No one knows for sure what system they use. My limit wasn't reduced and I only spend a couple of hundred pounds some months, next to nothing others. Same with my wife.

onlyfoolsandparking

Shakin_Steve said:

No one knows for sure what system they use. My limit wasn't reduced and I only spend a couple of hundred pounds some months, next to nothing others. Same with my wife.

You're not wrong when you say 'No one knows for sure what system they use' 
Having kept my eye out for the proposed limit reductions it hasn't happened yet and we are obviously well past the 20th May deadline. I thought oh well not a problem maybe it will happen after the accounts produce a statement and update, no change!!, then I thought maybe it would happen the 1st of the month, again no change and as of this morning both credit limits still showing no reduction?
Barclaycard really do work in mysterious ways don't they?
Out of interest has anyone who got the reduction letter actually seen their limit reduction when logging on?  
 

Shakin_Steve

onlyfoolsandparking said:

Shakin_Steve said:

No one knows for sure what system they use. My limit wasn't reduced and I only spend a couple of hundred pounds some months, next to nothing others. Same with my wife.

You're not wrong when you say 'No one knows for sure what system they use' 
Having kept my eye out for the proposed limit reductions it hasn't happened yet and we are obviously well past the 20th May deadline. I thought oh well not a problem maybe it will happen after the accounts produce a statement and update, no change!!, then I thought maybe it would happen the 1st of the month, again no change and as of this morning both credit limits still showing no reduction?
Barclaycard really do work in mysterious ways don't they?
Out of interest has anyone who got the reduction letter actually seen their limit reduction when logging on?  
 

My wife has a Tesco CC with a £10,100 limit and she spends a couple of hundred a month on it. She received a letter about a year ago saying, if she didn't get in touch to say different, they would reduce the limit to £5,500. She didn't get in touch and the limit was never reduced, so it isn't only Barclays.

vacheron

Looks like Barclays are looking to reduce credit risk in other divisions too, with equally illogical application. 
I recieved a letter from them today telling me that my mortgage reserve limit (effectively an overdraft facility which charges the same APR as my mortgage, will be reduced from 94,400 to £92,300 on the 24th of July. 

1. They are proposing to reduce my limit by 2.2%.... what's is even the point???  
2. They increased it automatically by £3.5k LAST MONTH, and again by another 3.3K just four months before that! Why didn't they just "not increase it" instead? 

Can't see the logic in this anywhere.

confused.com2

onlyfoolsandparking said:

Shakin_Steve said:

No one knows for sure what system they use. My limit wasn't reduced and I only spend a couple of hundred pounds some months, next to nothing others. Same with my wife.

You're not wrong when you say 'No one knows for sure what system they use' 
Having kept my eye out for the proposed limit reductions it hasn't happened yet and we are obviously well past the 20th May deadline. I thought oh well not a problem maybe it will happen after the accounts produce a statement and update, no change!!, then I thought maybe it would happen the 1st of the month, again no change and as of this morning both credit limits still showing no reduction?
Barclaycard really do work in mysterious ways don't they?
Out of interest has anyone who got the reduction letter actually seen their limit reduction when logging on?  
 

I came on here to see if anybody has had the reduction in limit yet. Supposedly happening 3 weeks ago yet my previous limit still stands. They've even sent me a balance transfer offer quoting my high limit that I was supposed to be losing!

mab3000

Deleted_User said:

Benefits aside, you only need to spend 1p on a credit card for S75 cover, provided the item meets the other criteria.

You need to spend a minimum of £100 on a credit card for S75 cover. 

kuratowski

You only need to spend a minimum of 1p on a credit card, but it has to be towards a purchase of between £100-£30000.

https://www.moneysavingexpert.com/reclaim/section75-protect-your-purchases/

mab3000

So it is. I always thought the minimum was £100 but you didn’t have to put the full amount on the card. 

onlyfoolsandparking

New statement produced today, still no limit reduction?