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You Are Here: Home > Personal Finance > Credit Cards > FAQ > Question and answer
Credit Cards

How your spending limit is determined
Last update : December 2011
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Your credit limit is the amount of credit available to you on your credit card. It is usually determined by the following -
Credit Cards - How much of a Credit Limit will I get
  1. Your income and other personal financial details such as whether you own a property or rent etc
  2. Your credit file - Details of past payment history - More information on Credit Files - What are they - How they really work
  3. Your past relationship with the provider - If you've always repaid at least the minimum balance, they will be more inclined to increase your limit
  4. The policy of the credit card provider (some are tight, others loose with credit)
  5. The type of credit card - Gold and Platinum cards normally have higher limits than standard type cards

Income and details held on your credit file are by far the most important. If you earn a good salary and have a nice, clean credit rating, £5,000 would probably be the starting level if you were to apply for a new card.

Also, if your initial limit is £5,000 and you operate your account responsibly for a year, it is possible that your limit will be raised and then increased again the following year.

Don't forget it's in the Credit Card providers' best interest to force us into a manageable debt situation, which is why credit limits are often both high and increase regularly.

However if you think your limit is too high, it is possible to get it reduced. Just call your provider and ask them to reduce it.

See also
FREE Report

How to Audit your Credit File
With errors your rating will suffer
How a clean credit rating can save you money
4 steps to a clean up any mistakes
Don't discount the importance of your credit file
It's absolutely critical.....
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