Credit card companies lower their credit limits

30/09/2008

It looks like its not only mortgages that are suffering in the current climate but credit card owners are also feeling the crunch. Credit card companies have been lowering credit limits as consumers struggle with payments and the ever increasing cost of living.

Spokesperson from the American Bankers’ Association Carol Kaplan said, “most banks are cutting their credit limits, they are doing it to everyone.”

A smaller credit limit means that consumers have less to spend and in today’s climate, this could be a worrying prospect for many card holders as they rely on putting much of their spending onto credit. This is yet another blow to consumers who could come into difficulty if they need to rely on their credit cards for any extra expenditure.

In addition to lower limits, if consumers go beyond their new lower limits, then they could face further issues with having to pay penalties for doing so causing consumers further aggravation.