Barclaycard limit reduction post covid

funkycredit

cymruchris said:

ian16527 said:

I have a Barclaycard but never use it now

That's one of the common reasons for limit reductions. 

Yet ironically credit cards are typically used for emergency spending, of course as well as rewards & section 75 etc. 

My BC is one of the lowest limits so I don't use it. But I've just swapped from Platinum to Reward so plan to put the next couple of holidays on it as my Amex cards have all met their requirements now; so why not. 

If they reduce my limit then it's daft as there's a genuine reason I don't use my card, it's there for certain things as and when needed. 

Luckily my main bank Santander aren't reducing limits, but then I do have cards with almost every provider. 

Still madness though that BC are implying they'll reduce limits to the previous years highest spend! 

vacheron

Barclays seem to favor this approach whenever they need to reduce their exposure, and to be honest I can't blame them because it probably works.

Send out 100,000 messages to customers informing them that their (unused) limit is reducing and 80% of them may not bat an eyelid. Of the 20% that do, maybe half of them will be bothered to call up and complain, just re-instate their limits and bang, you have managed to get rid of 90% of your exposure!

They did this with me a few years ago and as soon as I called they re-instated it, with no fuss. 

Coincidentally I got a text from their banking team yesterday asking if they can call me for a chat today. They are ringing at midday, so I wonder if this will come up!

Marmaduke123

I had this letter too, yesterday. Limit reduced from 6500 to 250! Useless to me, we only use it on holiday abroad, obviously didn't  have one last year. Probably will just cancel as we have another option for fee free transactions abroad.

To be fair, they will never have made any money out of us.

cpmarshall

Received a similar letter yesterday. I only took the card out for a zero  % balance transfer offer they were running at the time. That was paid off awhile back and I've never really used it since as I prefer to use my Amex rewards card as I earn quite a bit each year that way.  So when they reduced my limit to a silly figure I just cancelled it. The next week Amex increased my credit limit as did Lloyds, it would seem they have got wind of what Barclays  is doing and muscling in . Perhaps Barclays don't want to do c/cards anymore and are nudging customers into cancelling. Subprime customers can get a higher credit limit from other lenders than we are being offered by Barclays.

CRISPIANNE3

No sign yet of any limit reductions but my balance transfer offers have completely disappeared for the last two months. Not bothered as I have offers from card providers if I need one. 

draiggoch

Just had my letter today reducing the limit from £13100 to £5650. Strangely enough I had just cleared a balance of £5300 from it so it is sitting with a £0 balance today. They have included a form to appeal the reduction which includes statements concerning an increase in costs or decrease in earnings as well as asking for payslips or bank statements as supporting documentation.
I'm going to keep the card as I've had it almost 20 years (first credit card) but not going to appeal anything. 
It may be that there will be new offers in 12 months when I'll be moving 0% balances.

onlyfoolsandparking

draiggoch said:

Just had my letter today reducing the limit from £13100 to £5650. Strangely enough I had just cleared a balance of £5300 from it so it is sitting with a £0 balance today. They have included a form to appeal the reduction which includes statements concerning an increase in costs or decrease in earnings as well as asking for payslips or bank statements as supporting documentation.
I'm going to keep the card as I've had it almost 20 years (first credit card) but not going to appeal anything. 
It may be that there will be new offers in 12 months when I'll be moving 0% balances.

Or now that you've 'just' cleared the balance maybe they will reduce your limit even further?? appears very suspect that they reduced both my limits to £750 because I only owed around £500 and £350 on each of them.

Just out of interest and would welcome opinion I was talking to a friend of mine today regarding Barclaycard and their limit cull and he was telling me how he currently is carrying a balance of £7250 which fortunately is on a 0% deal till September this year. He hasn't received any limit reduction letter as yet but we started discussing what would happen if he did receive the letter and asked them to close his account, would he start paying interest when his deal runs out, could he ask for interest to be frozen whilst he pays it off as its being closed anyway?

I suspect and suggested to him that they will start charging interest from when his deal runs out as normal even if the account is closed and even if they did agree to freeze the interest he would probably end up having an AP marker put on his credit file so not worth it. He's not struggling financially and will BT away from Barclaycard before September but we were both curious as to if he could have a 'last roll of the dice' with Barclaycard so to speak as the account will be closed anyway.

Nice to see people closing their account/s I'm a big fan of voting with my feet too and will be closing both mine as soon as I can be bothered to.  

     

mirkle01

I got a letter this morning saying my limit has been reduced on my Barclaycard from £8,800 to £1,600. Coincidentally I moved £5,000 worth of debt off the card to a new zero % account I opened for this purpose. Seems rather vindictive, and I've never seen a warning anywhere that using zero % cards can result in such an action.

sonofmerton

of course if you owe money on your card and the limit has been reduced, your overall credit utilisation % will go up and likely affect other lending. 

cymruchris

mirkle01 said:

I got a letter this morning saying my limit has been reduced on my Barclaycard from £8,800 to £1,600. Coincidentally I moved £5,000 worth of debt off the card to a new zero % account I opened for this purpose. Seems rather vindictive, and I've never seen a warning anywhere that using zero % cards can result in such an action.

It's nothing personal against you don't worry. Barclaycard are obviously being very active in streamlining credit limits across a range of circumstances and customers, and there are a multitude of reasons as to why they might be doing it. It could be for example that as much as you maintained your account perfectly, paying minimum payment or just above every month, they might have classed you as a riskier proposition if you'd been carrying debt for a while. They are being proactive to what the world might be coming around to - which is more restricted availability of credit until things settle down a bit, and it's clear the world is in recovery mode.