High income, no debt - why won't Barclaycard increase my limit?

Tirian

A little while back I applied for a Barclaycard on a 0% for spending for 23 months deal.  I was accepted with a £6.5k limit.

Basically I would like to use as much as I can on the card, in order to build up some savings that will earn interest in the meantime, but in the medium term can also be used to pay for some renovation work on the house instead of taking a loan.  

As such I applied for the limit to be extended, but it was refused on the basis that they "have to be sure that I can afford repayments".

Now, I completely understand and agree with affordability assessments.  But I can't see how they could possibly apply here.

I have a high 6 figure income, I have no debts at all beyond £145 Paypal BNPL.  I have c. £60k in savings.  No CCJs or missed payments.  I have childcare costs (before & after school care for 2 kids), about £800 - £1000 per month, but no housing costs.  £500 a month for travel to work.  That's about it.

Any reason why they would be insisting on such a low limit, and saying that the reason they won't extend it is "affordability"? 

comeandgo

How many other credit cards do you have?  Barclay could be totalling all the credit you have that you could use.

TheMilkmansDad

What's the current balance on the card? how much have you used it? do you make payments against it?

Grumpy_chap

Barclaycard have been tightening credit limits for many people and certainly offering lower balances than was the case historically.

The BNPL balance will not likely to be seen as favourable as that type of borrowing is often seen as an indicator of the desperate and / or poor money management.

Savings have limited influence on credit card balances as it might be your intention to spend the lot tomorrow on a new car.

You seem to have a "thin" credit file so no demonstration that you can handle credit responsibly.

NOTE: the comments above are not my views, but the type of views that lenders can take.

Tirian said:

A little while back I applied for a Barclaycard on a 0% for spending for 23 months deal.  I was accepted with a £6.5k limit.

Basically I would like to use as much as I can on the card, in order to build up some savings that will earn interest in the meantime, but in the medium term can also be used to pay for some renovation work on the house instead of taking a loan.  

As such I applied for the limit to be extended, but it was refused on the basis that they "have to be sure that I can afford repayments".

Now, I completely understand and agree with affordability assessments.  But I can't see how they could possibly apply here.

I have a high 6 figure income, I have no debts at all beyond £145 Paypal BNPL.  I have c. £60k in savings.  No CCJs or missed payments.  I have childcare costs (before & after school care for 2 kids), about £800 - £1000 per month, but no housing costs.  £500 a month for travel to work.  That's about it.

Any reason why they would be insisting on such a low limit, and saying that the reason they won't extend it is "affordability"? 

Slinky

Could it be that your high income is actually working against you? See it from their view, they lend you a load of money for nearly 2 years at 0%, making nothing on it, and when it gets to the end of the deal, you pay it off in full and never use the card again. As it is, they're only risking £6.5K making no money, rather than the higher amount you want.

Nasqueron

Slinky said:

Could it be that your high income is actually working against you? See it from their view, they lend you a load of money for nearly 2 years at 0%, making nothing on it, and when it gets to the end of the deal, you pay it off in full and never use the card again. As it is, they're only risking £6.5K making no money, rather than the higher amount you want.

They make money from the spending fees and hope OP doesn't pay off in time and pays interest, sometimes offers are loss leaders to get in enough people to make money

DullGreyGuy

Tirian said:

A little while back I applied for a Barclaycard on a 0% for spending for 23 months deal.  I was accepted with a £6.5k limit.

Basically I would like to use as much as I can on the card, in order to build up some savings that will earn interest in the meantime, but in the medium term can also be used to pay for some renovation work on the house instead of taking a loan.  

As such I applied for the limit to be extended, but it was refused on the basis that they "have to be sure that I can afford repayments".

Now, I completely understand and agree with affordability assessments.  But I can't see how they could possibly apply here.

I have a high 6 figure income, I have no debts at all beyond £145 Paypal BNPL.  I have c. £60k in savings.  No CCJs or missed payments.  I have childcare costs (before & after school care for 2 kids), about £800 - £1000 per month, but no housing costs.  £500 a month for travel to work.  That's about it.

Any reason why they would be insisting on such a low limit, and saying that the reason they won't extend it is "affordability"? 

If you have a high 6 figure salary, so c£800,000 why are you using high street bank lending? 

If you have £60k in savings why are you considering a loan for renovations? If you have such a high salary and no housing costs how have you only managed to save less than 10% of your income in a lifetime?

What sort of limit are you hoping for?

You have a lack of history of using lending responsibly, people seem to think that having no lending is a good thing from a banks perspective, it isnt. It makes it a risk, they want to see you having had lending and paid it all off on time to show a track record of good behaviour. 

Whilst its almost certainly a machine decision, based on what you have said I could see what an underwriter would have concerns as it raises more questions than answers

Tirian

TheMilkmansDad said:

What's the current balance on the card? how much have you used it? do you make payments against it?

It's about £6,300.   I make minimum payments - since that's the whole benefit of having the 0% card ...

Hoenir

Tirian said:

TheMilkmansDad said:

What's the current balance on the card? how much have you used it? do you make payments against it?

It's about £6,300.   I make minimum payments - since that's the whole benefit of having the 0% card ...

On commercial grounds there's little benefit to Barclaycard extending the limit further.  

Tirian

Grumpy_chap said:

Barclaycard have been tightening credit limits for many people and certainly offering lower balances than was the case historically.

The BNPL balance will not likely to be seen as favourable as that type of borrowing is often seen as an indicator of the desperate and / or poor money management.

Savings have limited influence on credit card balances as it might be your intention to spend the lot tomorrow on a new car.

You seem to have a "thin" credit file so no demonstration that you can handle credit responsibly.

NOTE: the comments above are not my views, but the type of views that lenders can take.

Thanks.  I understand the concerns over BNPL balances, but the amount is negligible ... and paying credit reliably at 0% is financially responsible, so feels like treating all BNPL balances as a negative indicator, rather than high ones seems a pretty poor approach. 

My credit file is anything but thin.  I have paid mortgage for 15 years (up until Jan 2025), no missed payments/shortfalls.  I have two other credit cards that I pay off in full every month.  I have never missed a payment on loans, or on phone contract.  

Grumpy_chap

Tirian said:

Grumpy_chap said:

Barclaycard have been tightening credit limits for many people and certainly offering lower balances than was the case historically.

The BNPL balance will not likely to be seen as favourable as that type of borrowing is often seen as an indicator of the desperate and / or poor money management.

Savings have limited influence on credit card balances as it might be your intention to spend the lot tomorrow on a new car.

You seem to have a "thin" credit file so no demonstration that you can handle credit responsibly.

NOTE: the comments above are not my views, but the type of views that lenders can take.

Thanks.  I understand the concerns over BNPL balances, but the amount is negligible ... and paying credit reliably at 0% is financially responsible, so feels like treating all BNPL balances as a negative indicator, rather than high ones seems a pretty poor approach. 

My credit file is anything but thin.  I have paid mortgage for 15 years (up until Jan 2025), no missed payments/shortfalls.  I have two other credit cards that I pay off in full every month.  I have never missed a payment on loans, or on phone contract.  

You may well be correct about the decision algorithm resulting in a poor approach, but we are in the times of the automated coded decisions and long gone are the days when a Bank Manager would actually know your finances and listen to rationale about taking an interest free opportunity as sound financial management.