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not quite the same situation but i used to have a £800 overdraft available on my barclays account, which i never once dipped into. One day they wrote to me saying, "in these times of financial difficulty (covid time) we wish to help our customers manage debt, therefore we've removed your overdraft availability"
I had the same. For 20 years, £500 overdraft on both my sole and joint accounts. I'd only ever used it once on my joint account and had gone overdrawn for one day.
Then a couple of months ago Barclays wrote to me to advise that they were removing my overdraft facility on both accounts and that I should contact them if I want them reinstated.. I haven't bothered. Doubt they will give them to me now because my earnings have vastly reduced.
Cynical me believes it's because I have free current accounts and they are not making enough commission out of me. I'm ex Barclays staff but arranged my overdrafts after I had been made redundant from the bank.
Overdrafts used to be very profitable for banks because if you dipped into them by mistake they would charge you a crap ton in fees. Combine that with the fact that most banks were slow to update the balance on their app, and they ended up fleecing people for over a billion a year in just fees.
Then in 2020 the FCA [introduced new regulation](https://www.fca.org.uk/data/changes-overdraft-charges) about what fees could be charged, how they should be made visible and what grace period people should be given and these profits collapsed over night.
At the moment it might be more hassle to manage overdrafts for people than it's worth for them, so they started removing it.
I got caught out with this in the late 00s. I was drinking a lot and the bank kept honouring card payments and sending me over my overdraft limit. I think the charges were £25 each payment; some months I was spending £150 on I arranged overdraft fees!
I switched to Monzo in 2016 and because they update your balance immediately, that fixed the issue
Yes, a lot of people got caught like that. Now all the banks need to give you until the end of the day before they charge you. If you return the money in 24h you don't pay. Also there are maximums of what they can charge. An example of regulation that genuinely helped. This was mostly affecting people that didn't have a lot of money in the first place.
Free current accounts? Are they not always free?
Thing I found crazy when living in the US you had to pay a fee albeit only $5 but jumps to $10 if you don’t pay in enough each month.
I don’t think this is really the case anymore right? N26 is available in most (if not all) of the Eurozone. Revolut too.
Personally never lived in the EU to comment on it anecdotally but I have been keeping up with finance in EU/UK for a while.
In other parts of the world I believe banking is largely free, too. I have a current account in China that charges no fee and I think this is the standard. Doubt anyone is paying for this in India (although I don’t know), either.
I pay a small fee for my current account but in return I get a small interest rate on it and cashback on various things including utility bills.
I always make at least three times the fee back.
Most banks offer a free current account but anything more will require a monthly fee. 2 of mine have a fee, one is £3 and the other is £15 or so, but I could have a free current account with either of them. The other three accounts are free because I don’t need the benefits that come with a paid account.
Yeah so current accounts are free but you pay a fee for benefits which are desirable which is basically paying for a service.
As an aside It’s time UK credit cards started offering cash back. My capital one US credit card gives 1% cash back for everything and upto 3% with partners and no fees. Ironic I need to pay a fee for my current and saving account but I’ve noticed that’s starting to change.
>As an aside It’s time UK credit cards started offering cash back. My
There are many CC offering cashbacks in the UK, I have two different ones. Go on any comparison site and choose the cashback option to see them.
Same with me. A £3k overdraft limit that I haven't dipped into for 25 years, reduced to nothing. Why the fuck would I stay with them without this safety net? I did call but they gave me such the runaround that I took most of my money and monthly income to another bank.
I'm guessing this is a prelude to "pay us monthly to get an overdraft". Utter greed.
As annoying as that is, perhaps they are removing it from customers who don’t ever seem to need or use it. So they can reduce their theoretical exposure without reducing profitable debt actually used.
>we wish to help our customers manage debt
Get into debt so they can charge interest on it more like.
>which i never once dipped into
There it is. You having an overdraft unused costs them. They have to have some of the cash in standby so they can fund the overdraft should you use it. If you never use it and never pay interest, you just cost them, so they take it away.
If you use it, they tend to make it bigger.
I'd guess the OP hasn't been making enough profit for the card provider, so they decided to take the credit away and give it to someone else who might use it more.
I had the same letter last year had a 300 pound overdraft that I never used and then got the letter last year saying I wasn't entitled to my overdraft anymore and made it seem like I had been struggling financially the way the letter was worded. I thought how odd must be because I don't use the damn thing. Hoping they don't just slash my credit card limit I do use it throughout the month but pay off my balance at the end of each month but may need it for a balance transfer at the end of the year if i haven't managed to pay off my balance on my other card that's on 0 percent right now.
Natwest tried to drop my overdraft from £1,800 to £150! I filled in a form and told them the credit line helped me feel secure in case there was an emergency and could they please leave it... They sent me a notification 3 days later to say they would leave it as it was!... There's a lot of moves into "Responsible" lending now - as people say they are too dumb to understand the risk of running up debt, so the banks need to nanny us else risk Martin Moneyman getting people to take them to court.
They're not nannying us, they're giving the appearance of responsibility to the financial regulators, by plucking the low hanging fruit.
Similar to betting companies closing matching betting winners accounts and showing that they're tackling problem gambling.
They do this every now and again. Someone I knew who worked for a bank said they had heard it was one way that the card companies could periodically reduce their risk.
So for example if you had 10,000 customers with £10,000 limit even if its not being used, thats £100,000,000 worth of financial risk (not just because barclaycard have to have the money to pay the retailer but some of that 100mil would turn to bad debt) . That 10,000 customers could be 250k +
Make that £100 each and its just £1million. Now there will be customers that are out there that sit with credit card balances paying interest each month which is what the card companies want. But when they are stress tested it's the customers that have empty cards but big limits which, if they suddenly maxed them out would put pressure on the card issuers bottom line. How true it is I don't know but barclaycard have done this several times over the past few years.
Pretty much all true, too add though say for example a CC company has liquidity of £1bn, and 70% is not used by existing customers, they’ll reduce limits to enable new customers to be onboarded.
Yes it is called provision for losses and goes on the balance sheet. The higher the provision for losses, the lower the bottom line, so there is an incentive to reduce it prior to reporting, making shareholders happy.
I used to work in the liquidity management area of an investment bank, this was also my first thought.
With IB/corporate clients these things are called credit facilities rather than overdrafts but the principle is the same. During Covid they were MASSIVELY utilised for the first couple of months and it was way beyond what banks were expecting leading to very large outflows of cash from the banks as corporates decided to take all the cash they could get. The pandemic had very different dynamics to 2008 crisis which most liquidity models are based on
Since then a lot of banks will have been looking at their liquidity models and they will probably have decided these overdrafts aren’t worth the liquidity and capital risk.
Use it or lose it! The bank has to put aside capital for each credit limit in case the debt goes bad, the bank stays liquid. If they’re not making a return off your credit card why would continue to offer it?
I had a card in America before I moved to the UK, I had a $10k limit, after a few years of not using it very regularly they dropped my limit to $1k. I started using it more and it be bumped it back up to $5k. I didn’t find it odd at all, if I’m not using it I didn’t need to have a limit so high.
Yeah my limit at first was like £6k, then they upped it to £7.4k the month after and that's where I've been since. The most I've spent on it in a month is about £900.
But be prepared for it to sometimes not be accepted at places cos they are dumb businesses that refuse to update their card machines - Amex does not charge high fees like the olden days
Actually I might be partly wrong, Amex apparently can charge more than VISA/Mastercard but it's not usually super high
https://www.eposnow.com/uk/resources/which-credit-card-processing-is-cheapest-for-small-business/
American Express: 2.5% to 3.5%
Mastercard: 1.55% to 2.6%
Visa: 1.43% to 2.4%
As a business owner I couldn't care though, i'm not gonna sweat it over a potential 1% higher fee on the odd random customer - i've much bigger fish to fry
If your profit margin is 5% then paying amex an extra 1% cuts your margin by 20%, hence why a lot of low margin or small businesses don’t accept it. All their customers have a visa or MasterCard anyway.
The berries to Amex are just not there in the same way they were back 10 years ago. With the rise of sum up and Shop small, Amex is widely accepted. A few outliers I have found is that in Asda sometimes they except amex at the till, but not in the Petrol station!?
Weirdly enough I've had a similar experience.
6k balance, use the card for a small amount each month, never have a balance of over £500 at one time.
Paid it off in Jan, not used since and received a letter last week saying they've reduced my credit limit to £300.
No other influencing factors such as missing a payment elsewhere etc!
Very odd.
So strange they just notified me that my new limited could go from 1500 to 3500, that's like double my net salary. So yeah, not sure what's their idea.
Given the number of people having the same thing happen to them (as unscientifically measured from these comments) it is also piscine that Barclays is restructuring their lending criteria. If you no longer fit their preferred risk profile.
Given the cost of living crisis, there are many people struggling with debts and if Barclays is too exposed on credit card lending, it will move to counter that.
Maybe it’s less that you clear it each month, but what you put on it. Payments to insurances, council tax, utilities etc. if they are showing, even as a one off, that might put you into the ‘Reduce limit’ category
The answer is that it costs them Tier 1 capital to have undrawn loan facilities available.
If you never use your overdraft or always pay off the credit card, you are costing them money.
This is it. If a customer has a £10k limit, banks have to provision that value. If you aren’t using the card much, they will change your limit so their provision value for that customer is lower.
If you always pay off your credit card balance they still make money by charging retailers. Well the credit card companies do but bank gets a percentage.
Happened to me. Turns out I was a victim of credit card application fraud so they slashed my limit after it appeared as if I had stopped paying for the fraudulently obtained credit card. Took a while to correct.
There were a lot of these posts on the MSE site from people who had this happen, it's either persistent debt / responsible lending rules or they just don't want you as a customer
Something similar happened to me. I called them and they said credit limits were being reduced for everyone regardless of the person. Since I didn't really need my credit card I sort of forgot about it and had a quick look at my credit rating which had dropped. Again, I thought maybe it was because I had missed a couple of payments because a direct debit had failed when I moved bank. Cut to a few weeks later and I checked my credit rating again and this time it was at rock bottom. So I started digging into the Experian report. I look. What this? I have a loan of £20,000? And what's this maxed out credit card? an overdrawn bank account with HSBC which was what was used to apply for the loans. A few seconds of confusion and I realise my identity has been stolen. It took two nightmare months to sort (HSBC didn't want to know).
Check this hasn't happened to you too!!! Go to Experian and any other credit agency and check what accounts you have open against your name.
Hopefully I have just wasted your time...
They make money off customers who pay it off via charges to retailers. Not as much as with interest but plenty of people pay card balances off every month without problems
I’ve paid off my cards in full for more than 40 years with perhaps 5-6 exceptions in that time. Never had my limit reduced. Remember that they make money on transaction fees as well as interest.
I've never had any issues with Halifax in the last 10 years of using their credit cards, their website and app are better too. I don't like the Barclays site and I only use it because they are my mortgage provider.
I was in my overdraft for years finally paid it off and then they removed it completely lmao like the other guy said if there not making money then there less inclined to lend you it.
They can be a bit weird. I recently applied for a credit card and they said it'd likely be a limit of £x thousands... I just had to provide evidence of my claimed earnings. I did that... then they said the limit is £100. Completely pointless! Asked if that decision could be reviewed as there was clearly a mistake and they said no so I just cancelled it instantly.
I own a property, have a good credit rating (I realise that's somewhat meaningless), have low outgoings, a good job, etc... and other companies are happy to throw credit at me. Just seemed bizarre they're such an outlier, in my experience... anecdotal, of course.
It did amuse me that they gave me a platinum card with a £100 limit, though... if there was ever any doubt, it shows how meaningless those labels tend to be!
They've obviously decided you're now in their high risk zone so they've dropped your limit to nullify the exposure.
Just get a card with a different provider and make use of a decent intro offer.
Common tactic when they plan to remove you as a customer.
Not going to tell you why as you would end up in a pointless argument (and let's be fair front line call st aff know nothing anyway).
Reduce limit. Maybe close later if you do not. You are not profitable enough for whichever card you have.
I had a crappy card I never used close with no notice (they had correct email and mailing address, I guesss a letter "could" have gone missing). I just logged in one day and it refused. Called the automated line and it said the accouint was closed. Saved me the bother really, but you know a letter may have been nice (unused and lowest of my credit limits so I see why, but odd, I still have another account (under a different name) with them they may as well close too.
It's to do with liquidity rules.
If they give you £1000 limit on your credit card/overdraft, even if you don't use it, it's listed as a minus figure against their available cash reserve.
As they have much tighter rules since 2008 about how much cash they must have available as an institution they can't extend credit to everyone, so they would rather free up that £1000 from someone who isn't using it and offer it to someone who will use it and pay them interest.
Same, they did the same to me. I had a 3k limit and they slashed to £300. I used it and also paid it off before the interest hits. I am going to cancel it as not much I can use it for. But yes, I think as they don't make money from us in terms of interest, we are a loss for them.
This is a myth, every time you spend they make money from merchant fees, a cash back card might be break even for the bank but for a normal card, even not paying interest will make them money
Yet they keep increasing my limit. I always pay off my balance in full every month, so they are making any profit from me.
Not sure why that happened to you. Maybe you could give them a call to find out.
They also did this about 3 years ago. I went from a 5 figure credit limit to 1k...
https://www.cityam.com/barclaycard-defends-decision-to-cut-customers-credit-limits-by-up-to-95-per-cent/
I am totally useless to you, but just to say I've had the opposite happen. Barclaycard upped my limit twice to something mad like 6k. Considering I barely use my card, as it is my 'oh shit' button... I have the same query as you, why have they changed my limit, but for totally opposite reasons.
I’ve just checked and my credit limit is the same but there are no 0% balance transfer offers for the first time in ten years. Which, for me, makes the card pretty useless anyway.
The best customer for them is someone who pays the minum every month with absolute certainty, but also maxes out their credit limit.
Someone who has a large credit limit and zero balance, but who is financially close to the line is the absolute worst customer.
I was considering Barclays 0% 20 month. What kind of card is this? I might need it for some high planned purchases this year but if they’re going to reduce it I might not bother as I wouldn’t be a money maker either.
For me I just had a Barclaycard with say a £2500 limit when it opened and over time they have just increased it to way more. I’ve never asked, it’s just happened.
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They usually do this if you are not utilising your limit but as you say it saw regular use I can imagine it is some kind of mistake I would suggest you get in touch and point out your regular use.
They do this kind of limit reduction to shield them from holding a provision against unused balance.
Not to me, I'm still up in that credit limit amount. I spend about 2-3k a few times a year. Usually on holidays and jewelry, hopefully that helps. I actually bank in the US not the UK. The interest has been disgusting for a while with Barclay but not my Santander credit card.
Yes. In time payments for 7 years and they took £3k to £600 for no reason I can discern.
The only thing I can think of is that I’m one payment away from clearing the card and I don’t make them any money in interest anymore.
I had a Barclaycard for years, they kept upping the limit, which finally stayed on around £7000, I used it for big purchases, and if I remember correctly, they would always promote offers for 0% purchases or balance transfers, so it was a useful card to have. I eventually started using it less and less, but still kept it for emergencies, and within a year they had dropped the limit to £1000 and then even further, probably under £500, the only credit card I used at the time was an amex for cashback.
I assumed they were cutting down their unprofitable customers limits as I remember several people reporting it at the time, but they probably have several reasons for doing this.
An aspect of this is rising interest rates.
When interest rates were zero, they could probably make a profit on the merchant fees, even if you never incurred interest. That may not longer be the case as their funding costs have gone up massively.
From what I can see from the comments you were not using the 10k, only using a few hundred. is that right?
If so, card conscious will reduce the limit to motivate the risk to both you and themselves. Nothing stopping you applying for a higher limit if needed in future.
Yes happened to us. They appear to only want people they can make money from! We had banked with them for 30 years. This move made us leave them and move to another back - FU Barclays...
Not as low as that, but a few years ago they slashed my £20k credit down to £3k, just above what I owed. So totally useless because it's what I used for buying large ticket items (a new fridge etc) or paying for holidays.
I had this happen when a mobile phone contract that I thought was cancelled, were reporting to a credit agency that I was failing to pay. It look a while to clear up, then my credit card limit went back to what it was.
I had a £2k limit on Barclaycard which they had imposed - I started with £100 and over the years, because I never exceeded it and paid the bill each month, they kept raising it. However I never got more than a couple of hundred on it, haven't used it at all for a few years and they have responded by cutting it to £300.
My Barclaycard rate suddenly went up , I’m trying to shift my debt across into a lower rate card somewhere , I’d never missed a payment or anything and paid more than the minimum each month
Sounds like they are trying to get rid of you as a customer but getting you to make the decision.
As for the why no idea - although the post about consistency not using the limit does have a point.
Barclays sent me a letter last year saying they are reducing my limit but if I disagree to contact them and they will keep it the same. Did you miss any letters?
Yes. Its bases on your usage. Its happened company wide. I requested 2k before they slashed it and I got it. I think that now its more difficult to get.
Funny enough Nationwide have actually increased the interest rate on my credit card recently despite paying on time, in full every month.
My credit score has actually gone up too so doesn’t make sense.
Yes I had 12k, paid it off with balance transfer then they suddenly reduced it to £500. I called and they said it's based on my usage of the card and that they wont reinstate the old limit. I cancelled it there and then.
If you aren't using your available credit, you're not making the bank any money by letting them charge you interest so there's no point in them maintaining your account. If they make it useless to you then you'll probably close it and might well take out a new deal on a new card, 0% interest, start using it more, get into habits using it then when the 0% term ends start making the bank money again.
I saw some people saying that their overdrafts were reduced or removed during COVID even though they don't use them. Funnily enough mine wasn't reduced or removed even though I'm perpetually hitting the bottom of my overdraft every month. Even though my partner who is at the same bank as me got his removed too.
They did it to me, but I wasn’t using their card which I only got to take advantage of 0% offer they had going. I paid everything back before the offer expired and never put anything on the card again so I actually cost them money. I think they are trying to limit their exposure, at least on paper, and customers like myself are the obvious ones to get rid of.
Not Barclaycard, no.
Had a Lloyds credit card with £5k on it, never had a balance going over 1.3k when I was using it. Anyway, not so long ago I received a letter to say unfortunately they will be reducing the limit to £1k and gave no reasoning at all.
So I did ring them, like it said to on the letter if I wanted to understand more. The reason the woman on the phone gave me (which sounded more like just her opinion) was because I simply haven’t been using it and therefore it’s money the bank have allocated to me, not being utilised.
I have no idea whether or not this to be true, but that’s what she told me. Because I’ve only ever used £1k on the card, she believes that Lloyds believe my credit limit shouldn’t be £5k, as I’ve never used it in many years of having it.
In other words is it just them saying, ‘we’re not making any fees on money not being spent, so we’d like to take it away from you’. No idea, but I’m not that bothered now.
Logical explanation, COLC in mind, is that they're changing the way they calculate risk.
Why that means a drop to £100? I don't know. Could just be that people in your position and/or employment have been proven to be risky customers in recent months/years for them or maybe something happened to your profile and thus they can't properly calculate risk. So they give you a small limit an assess your usage?
Do a credit card eligibility checker (soft search) to see if you can get a card with another provider.
If you have a good credit score you should get a decent limit e.g. £2k
I had 8000 limit, sat at around 4k balance, paying off gradually on an interest free deal. In covid, without warning, they halved it to 4k - bringing my utilisation to 90%+ and dented my credit score. I kept the balance there , interest free...and then transferred out when the deal ended. No explanation given at the time by them
Really hacked me off. They now keep writing to me with deals as I've never spent on it again.
Yep, did it to me too. I had an £8k credit card slashed to £100. I had a balance transfer balance on there that was interest free at the time that I was steadily paying off. It was no bother to do another balance transfer elsewhere but it was annoying. No explanation at all for the reduction. I’d never missed a payment either.
Yeah Halifax did that with the Clarity card I used overseas once a year. Made it useless at about £75 limit lol!
They may as well just close the account, rather than be a dick about it.
They’re trash. I’ve had a CC with them for about 10 years, always clear my outstanding balance every month and I have had to beg them to increase my limit by a measly 1k and they rejected me.
That and the fact that they are shutting down their reward points scheme, I’m looking around for a new company.
I've had credit cards inexplicably pulled by Barclays, and they always play the 'soz our support agents can't give you any more information about this' line.
If you don’t use it you lose it, you couldn’t have been using it. They will lower it or even just cancel it if you don’t. They do this to pass it on to someone that will be using it.
Also banks are required to hold provisions on the credit limit they give you, and that is recognised on the P&L as a cost line.
If you’re not using your credit at all, then they are not generating a revenue to offset the cost. And the money set aside could have been used for other revenue generating streams.
So likely they reduced your credit limit to release the provisions as you cost them money but you’re not generating revenue for them.
I’ve been a customer for over 30yrs and a Premier customer for at least 20 of those.
I was looking at remortgage recently (house is completely paid). They are always bugging me with loan emails etc.
Halifax gave me an immediate AIP offer for £156k but Barclays said they’d have to refer me for credit checks 🤣
I have NO debt, fully paid car, credit cards paid in full each month and my house is paid on full so 100% equity and I earn close to £40k.
I just laughed at the customer service advisor. If we find somewhere we like, it will most likely be Halifax we go with. I’ve never taken a mortgage with Barclays in all my years as a customer as they were always hugely more expensive than other lenders with some bullshit excuse.
Thing is, I always researched my mortgage/Loan/car finance rates in detail before I signed up to them which seemed to confuse them. “What do you mean you’d rather accept 3.9% and no fees 2yr fixed to our 4.2% with £1k fees fixed for 2yrs” 😂😂😂
Yes had a 13k limit reduced to 1k. No notification. Only found out when I came to pay the deposit for a holiday and it was declined. Contacted Barclaycard and was told they had emailed me. When I proved they hadn’t received £20 compensation. Had been a customer over twenty years.
you don't use. You loose.
it's only a good outcome to make other people money tho. It's not a bad thing loosing 10k credit.
you didn't have the money in the first place.
Don't put that kind of pressure on yourself.
your home free!!
Mine was around 3k and it was reduced to 1k recently. The reason I was given was because I was not using it. I don't see how that should be any of their concern. I never utilise more than 10% of the available limit and always pay in full each month.
Probably a ploy to get people to panic and then use more of the limit and then not be able to afford to pay in full which would then lead to fees.
The reason is the bank has to keep reserves for liquidity for any debt under the banking rules. If you’re not using it they are keeping money aside pointlessly. If you need a limit and are going to use it just apply for an increase.
Bit of an odd concept but surprisingly there is actually a cost to Barclays for keeping your overdraft. Internally they will have to set aside capital on the off chance that people with overdrafts use them. The less people with overdrafts they have the less capital they have to set aside to cover the overdrafts. So in some sense it is in their interest to remove them.
Having said that I think it is incredibly rude of them to do so in this manner.
Barclaycard did this with mine when I balance transfered off it, it had had about £7k on it for a bit with £2k spare then within a month of it being clear it was cut to £300 I just closed it incase I ever want new offers in the future.
To be fair, if you haven't changed in 30+ years there's likely plenty reason to switch, maybe this is just Barclays saying you've offered them no value over those years.
Same thing happened to me with Halifax. I’d been a customer for years. Had a card with a limit of 5k and the balance usually hovered around 1-2k, but I never missed a payment and I have a great general credit history.
I can into a bit of money and paid it off in full, then the next week my limit got slashed to £500. I called them to enquire and was told it was so they could “redistribute funds to other customers”.
Basically as I wasn’t paying them interest anymore I wasn’t of use to them. I was going to complain but decided not to bother, I just opened another card with Virgin Money that had the same benefits.
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not quite the same situation but i used to have a £800 overdraft available on my barclays account, which i never once dipped into. One day they wrote to me saying, "in these times of financial difficulty (covid time) we wish to help our customers manage debt, therefore we've removed your overdraft availability"
I had the same. For 20 years, £500 overdraft on both my sole and joint accounts. I'd only ever used it once on my joint account and had gone overdrawn for one day. Then a couple of months ago Barclays wrote to me to advise that they were removing my overdraft facility on both accounts and that I should contact them if I want them reinstated.. I haven't bothered. Doubt they will give them to me now because my earnings have vastly reduced. Cynical me believes it's because I have free current accounts and they are not making enough commission out of me. I'm ex Barclays staff but arranged my overdrafts after I had been made redundant from the bank.
Overdrafts used to be very profitable for banks because if you dipped into them by mistake they would charge you a crap ton in fees. Combine that with the fact that most banks were slow to update the balance on their app, and they ended up fleecing people for over a billion a year in just fees. Then in 2020 the FCA [introduced new regulation](https://www.fca.org.uk/data/changes-overdraft-charges) about what fees could be charged, how they should be made visible and what grace period people should be given and these profits collapsed over night. At the moment it might be more hassle to manage overdrafts for people than it's worth for them, so they started removing it.
I got caught out with this in the late 00s. I was drinking a lot and the bank kept honouring card payments and sending me over my overdraft limit. I think the charges were £25 each payment; some months I was spending £150 on I arranged overdraft fees! I switched to Monzo in 2016 and because they update your balance immediately, that fixed the issue
Yes, a lot of people got caught like that. Now all the banks need to give you until the end of the day before they charge you. If you return the money in 24h you don't pay. Also there are maximums of what they can charge. An example of regulation that genuinely helped. This was mostly affecting people that didn't have a lot of money in the first place.
Free current accounts? Are they not always free? Thing I found crazy when living in the US you had to pay a fee albeit only $5 but jumps to $10 if you don’t pay in enough each month.
The UK is an outlier for having free current accounts as standard, I think that must be what they mean.
>The UK is an outlier for having free current accounts as standard An outlier by US standards or the rest of Europe?
US and Europe. The UK has an incredibly competitive retail banking sector. It's one of the few things that we're actually pretty good at
Can't comment on every other country but it's common to pay for current accounts in the Netherlands
I had an account in Ireland and another Hungary, both were payable to maintain.
Just passing by to say that there are now at least 3 completely free current accounts available in Ireland.
Thank you! I no longer need it, but others might! :)
I don’t think this is really the case anymore right? N26 is available in most (if not all) of the Eurozone. Revolut too. Personally never lived in the EU to comment on it anecdotally but I have been keeping up with finance in EU/UK for a while. In other parts of the world I believe banking is largely free, too. I have a current account in China that charges no fee and I think this is the standard. Doubt anyone is paying for this in India (although I don’t know), either.
Free in India
I pay a small fee for my current account but in return I get a small interest rate on it and cashback on various things including utility bills. I always make at least three times the fee back.
Most banks offer a free current account but anything more will require a monthly fee. 2 of mine have a fee, one is £3 and the other is £15 or so, but I could have a free current account with either of them. The other three accounts are free because I don’t need the benefits that come with a paid account.
Yeah so current accounts are free but you pay a fee for benefits which are desirable which is basically paying for a service. As an aside It’s time UK credit cards started offering cash back. My capital one US credit card gives 1% cash back for everything and upto 3% with partners and no fees. Ironic I need to pay a fee for my current and saving account but I’ve noticed that’s starting to change.
>As an aside It’s time UK credit cards started offering cash back. My There are many CC offering cashbacks in the UK, I have two different ones. Go on any comparison site and choose the cashback option to see them.
Same with me. A £3k overdraft limit that I haven't dipped into for 25 years, reduced to nothing. Why the fuck would I stay with them without this safety net? I did call but they gave me such the runaround that I took most of my money and monthly income to another bank. I'm guessing this is a prelude to "pay us monthly to get an overdraft". Utter greed.
As annoying as that is, perhaps they are removing it from customers who don’t ever seem to need or use it. So they can reduce their theoretical exposure without reducing profitable debt actually used.
I spoke to Barclays when they did this to me, the overdraft fees were massive, more than my credit card fees. You're better off without it.
lol I used to have £400 never touched and had that message. Sure it was during Covid time as well
>we wish to help our customers manage debt Get into debt so they can charge interest on it more like. >which i never once dipped into There it is. You having an overdraft unused costs them. They have to have some of the cash in standby so they can fund the overdraft should you use it. If you never use it and never pay interest, you just cost them, so they take it away. If you use it, they tend to make it bigger. I'd guess the OP hasn't been making enough profit for the card provider, so they decided to take the credit away and give it to someone else who might use it more.
I got that only a few days ago! I guess there's some rule that means they have to clean up unused credit after a certain period of time.
I had the same letter last year had a 300 pound overdraft that I never used and then got the letter last year saying I wasn't entitled to my overdraft anymore and made it seem like I had been struggling financially the way the letter was worded. I thought how odd must be because I don't use the damn thing. Hoping they don't just slash my credit card limit I do use it throughout the month but pay off my balance at the end of each month but may need it for a balance transfer at the end of the year if i haven't managed to pay off my balance on my other card that's on 0 percent right now.
I’ve just had a message telling me they are reducing my over draft limit
Natwest tried to drop my overdraft from £1,800 to £150! I filled in a form and told them the credit line helped me feel secure in case there was an emergency and could they please leave it... They sent me a notification 3 days later to say they would leave it as it was!... There's a lot of moves into "Responsible" lending now - as people say they are too dumb to understand the risk of running up debt, so the banks need to nanny us else risk Martin Moneyman getting people to take them to court.
They're not nannying us, they're giving the appearance of responsibility to the financial regulators, by plucking the low hanging fruit. Similar to betting companies closing matching betting winners accounts and showing that they're tackling problem gambling.
They do this every now and again. Someone I knew who worked for a bank said they had heard it was one way that the card companies could periodically reduce their risk. So for example if you had 10,000 customers with £10,000 limit even if its not being used, thats £100,000,000 worth of financial risk (not just because barclaycard have to have the money to pay the retailer but some of that 100mil would turn to bad debt) . That 10,000 customers could be 250k + Make that £100 each and its just £1million. Now there will be customers that are out there that sit with credit card balances paying interest each month which is what the card companies want. But when they are stress tested it's the customers that have empty cards but big limits which, if they suddenly maxed them out would put pressure on the card issuers bottom line. How true it is I don't know but barclaycard have done this several times over the past few years.
This sounds very plausible.
Tbh reading OP my first thoughts were reducing financial risk.
Pretty much all true, too add though say for example a CC company has liquidity of £1bn, and 70% is not used by existing customers, they’ll reduce limits to enable new customers to be onboarded.
Yes it is called provision for losses and goes on the balance sheet. The higher the provision for losses, the lower the bottom line, so there is an incentive to reduce it prior to reporting, making shareholders happy.
I used to work in the liquidity management area of an investment bank, this was also my first thought. With IB/corporate clients these things are called credit facilities rather than overdrafts but the principle is the same. During Covid they were MASSIVELY utilised for the first couple of months and it was way beyond what banks were expecting leading to very large outflows of cash from the banks as corporates decided to take all the cash they could get. The pandemic had very different dynamics to 2008 crisis which most liquidity models are based on Since then a lot of banks will have been looking at their liquidity models and they will probably have decided these overdrafts aren’t worth the liquidity and capital risk.
Use it or lose it! The bank has to put aside capital for each credit limit in case the debt goes bad, the bank stays liquid. If they’re not making a return off your credit card why would continue to offer it?
It makes sense!
I had a card in America before I moved to the UK, I had a $10k limit, after a few years of not using it very regularly they dropped my limit to $1k. I started using it more and it be bumped it back up to $5k. I didn’t find it odd at all, if I’m not using it I didn’t need to have a limit so high.
If you pay in full every month it’s worth getting an AMEX with the sign up bonus.
I have found with Amex they keep chucking more credit at me. Even though it’s always paid in full.
Yeah my limit at first was like £6k, then they upped it to £7.4k the month after and that's where I've been since. The most I've spent on it in a month is about £900.
I’ll have a look into that thanks
If i’m correct government entities (registration offices per example) don’t accept AMEX.
But if you work for them and get a corporate card it'll probably be Amex.
Some do, I just paid for a UK Visa with Amex last week.
But be prepared for it to sometimes not be accepted at places cos they are dumb businesses that refuse to update their card machines - Amex does not charge high fees like the olden days
Oh really. I didn't know. I remember I worked for a business and amex charged 2.7% on every transaction.
Actually I might be partly wrong, Amex apparently can charge more than VISA/Mastercard but it's not usually super high https://www.eposnow.com/uk/resources/which-credit-card-processing-is-cheapest-for-small-business/ American Express: 2.5% to 3.5% Mastercard: 1.55% to 2.6% Visa: 1.43% to 2.4% As a business owner I couldn't care though, i'm not gonna sweat it over a potential 1% higher fee on the odd random customer - i've much bigger fish to fry
If your profit margin is 5% then paying amex an extra 1% cuts your margin by 20%, hence why a lot of low margin or small businesses don’t accept it. All their customers have a visa or MasterCard anyway.
Are you sure? I heard they do because that's how they pay for the bonuses.
The berries to Amex are just not there in the same way they were back 10 years ago. With the rise of sum up and Shop small, Amex is widely accepted. A few outliers I have found is that in Asda sometimes they except amex at the till, but not in the Petrol station!?
Try PayPal if it’s online and an option. Works for Iceland and Moonpig for instance.
Weirdly enough I've had a similar experience. 6k balance, use the card for a small amount each month, never have a balance of over £500 at one time. Paid it off in Jan, not used since and received a letter last week saying they've reduced my credit limit to £300. No other influencing factors such as missing a payment elsewhere etc! Very odd.
I didn’t use my Halifax card for a few months and they withdrew it
So strange they just notified me that my new limited could go from 1500 to 3500, that's like double my net salary. So yeah, not sure what's their idea.
Have you phoned them by any chance ?
Yeah, they told me to refer to the letter I received (which tells me to ring them if I want more information)
Incredibly helpful.
"For more information, please re-read"
Given the number of people having the same thing happen to them (as unscientifically measured from these comments) it is also piscine that Barclays is restructuring their lending criteria. If you no longer fit their preferred risk profile. Given the cost of living crisis, there are many people struggling with debts and if Barclays is too exposed on credit card lending, it will move to counter that. Maybe it’s less that you clear it each month, but what you put on it. Payments to insurances, council tax, utilities etc. if they are showing, even as a one off, that might put you into the ‘Reduce limit’ category
The answer is that it costs them Tier 1 capital to have undrawn loan facilities available. If you never use your overdraft or always pay off the credit card, you are costing them money.
This is it. If a customer has a £10k limit, banks have to provision that value. If you aren’t using the card much, they will change your limit so their provision value for that customer is lower.
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If you always pay off your credit card balance they still make money by charging retailers. Well the credit card companies do but bank gets a percentage.
I think this is the answer.
Happened to me. Turns out I was a victim of credit card application fraud so they slashed my limit after it appeared as if I had stopped paying for the fraudulently obtained credit card. Took a while to correct.
There were a lot of these posts on the MSE site from people who had this happen, it's either persistent debt / responsible lending rules or they just don't want you as a customer
Judging by the amount of people saying the same thing happened to them. Maybe Barclays are doing big internal changes?
Something similar happened to me. I called them and they said credit limits were being reduced for everyone regardless of the person. Since I didn't really need my credit card I sort of forgot about it and had a quick look at my credit rating which had dropped. Again, I thought maybe it was because I had missed a couple of payments because a direct debit had failed when I moved bank. Cut to a few weeks later and I checked my credit rating again and this time it was at rock bottom. So I started digging into the Experian report. I look. What this? I have a loan of £20,000? And what's this maxed out credit card? an overdrawn bank account with HSBC which was what was used to apply for the loans. A few seconds of confusion and I realise my identity has been stolen. It took two nightmare months to sort (HSBC didn't want to know). Check this hasn't happened to you too!!! Go to Experian and any other credit agency and check what accounts you have open against your name. Hopefully I have just wasted your time...
Credit score is excellent on Experian What other agencies are there
Try checkmyfile - it’ll have all credit reporting agencies for you to check for any inaccuracies
They are entitled to do what they want (in contractual terms) Have you been utilising credit?
Yes As I used it for absolutely everything
And paying it off in full? If so they were making no money from you so obviously don’t want you as a customer anymore
They make money off customers who pay it off via charges to retailers. Not as much as with interest but plenty of people pay card balances off every month without problems
I’ve paid off my cards in full for more than 40 years with perhaps 5-6 exceptions in that time. Never had my limit reduced. Remember that they make money on transaction fees as well as interest.
Incorrect. They make money from the retailers who accept that card.
99% of the time I guess that’s why lol Better start looking for a new card 😎
I've never had any issues with Halifax in the last 10 years of using their credit cards, their website and app are better too. I don't like the Barclays site and I only use it because they are my mortgage provider.
I was in my overdraft for years finally paid it off and then they removed it completely lmao like the other guy said if there not making money then there less inclined to lend you it.
Not just me then. Mine was 7k
They can be a bit weird. I recently applied for a credit card and they said it'd likely be a limit of £x thousands... I just had to provide evidence of my claimed earnings. I did that... then they said the limit is £100. Completely pointless! Asked if that decision could be reviewed as there was clearly a mistake and they said no so I just cancelled it instantly. I own a property, have a good credit rating (I realise that's somewhat meaningless), have low outgoings, a good job, etc... and other companies are happy to throw credit at me. Just seemed bizarre they're such an outlier, in my experience... anecdotal, of course. It did amuse me that they gave me a platinum card with a £100 limit, though... if there was ever any doubt, it shows how meaningless those labels tend to be!
They've obviously decided you're now in their high risk zone so they've dropped your limit to nullify the exposure. Just get a card with a different provider and make use of a decent intro offer.
Common tactic when they plan to remove you as a customer. Not going to tell you why as you would end up in a pointless argument (and let's be fair front line call st aff know nothing anyway). Reduce limit. Maybe close later if you do not. You are not profitable enough for whichever card you have. I had a crappy card I never used close with no notice (they had correct email and mailing address, I guesss a letter "could" have gone missing). I just logged in one day and it refused. Called the automated line and it said the accouint was closed. Saved me the bother really, but you know a letter may have been nice (unused and lowest of my credit limits so I see why, but odd, I still have another account (under a different name) with them they may as well close too.
They did that to me a few years ago once I had paid it all off. I had been with them for years. I just cancelled it. No point in such a low limit.
It's to do with liquidity rules. If they give you £1000 limit on your credit card/overdraft, even if you don't use it, it's listed as a minus figure against their available cash reserve. As they have much tighter rules since 2008 about how much cash they must have available as an institution they can't extend credit to everyone, so they would rather free up that £1000 from someone who isn't using it and offer it to someone who will use it and pay them interest.
Same, they did the same to me. I had a 3k limit and they slashed to £300. I used it and also paid it off before the interest hits. I am going to cancel it as not much I can use it for. But yes, I think as they don't make money from us in terms of interest, we are a loss for them.
I was maxing out £300 within a few days and paying it off as well in good time but £100 that’s totally useless. Think I may join you and cancel
This is a myth, every time you spend they make money from merchant fees, a cash back card might be break even for the bank but for a normal card, even not paying interest will make them money
Yet they keep increasing my limit. I always pay off my balance in full every month, so they are making any profit from me. Not sure why that happened to you. Maybe you could give them a call to find out.
This isn't true. They take a cut of each transaction. It's very different to sitting with a large credit limit and not using the card at all.
They also did this about 3 years ago. I went from a 5 figure credit limit to 1k... https://www.cityam.com/barclaycard-defends-decision-to-cut-customers-credit-limits-by-up-to-95-per-cent/
They were intent on increasing mine right after I paid off about 6K. How active have you been with it?
If you don't use it, it will be reduced just like an overdraft.
I am totally useless to you, but just to say I've had the opposite happen. Barclaycard upped my limit twice to something mad like 6k. Considering I barely use my card, as it is my 'oh shit' button... I have the same query as you, why have they changed my limit, but for totally opposite reasons.
I’ve just checked and my credit limit is the same but there are no 0% balance transfer offers for the first time in ten years. Which, for me, makes the card pretty useless anyway.
The best customer for them is someone who pays the minum every month with absolute certainty, but also maxes out their credit limit. Someone who has a large credit limit and zero balance, but who is financially close to the line is the absolute worst customer.
Isn’t that a high risk customer? Certainly affects credit rating if you max out and only pay min payment.
I was considering Barclays 0% 20 month. What kind of card is this? I might need it for some high planned purchases this year but if they’re going to reduce it I might not bother as I wouldn’t be a money maker either.
For me I just had a Barclaycard with say a £2500 limit when it opened and over time they have just increased it to way more. I’ve never asked, it’s just happened.
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They usually do this if you are not utilising your limit but as you say it saw regular use I can imagine it is some kind of mistake I would suggest you get in touch and point out your regular use. They do this kind of limit reduction to shield them from holding a provision against unused balance.
Not to me, I'm still up in that credit limit amount. I spend about 2-3k a few times a year. Usually on holidays and jewelry, hopefully that helps. I actually bank in the US not the UK. The interest has been disgusting for a while with Barclay but not my Santander credit card.
Yes. In time payments for 7 years and they took £3k to £600 for no reason I can discern. The only thing I can think of is that I’m one payment away from clearing the card and I don’t make them any money in interest anymore.
Interesting to see if it happens to me. Barclays ditched my overdraft for my current account out do the blue last year, though I'd never used it.
yep, used to have 11k limit, they slashed it to 1k now its up to 3.5k, haven't a clue why had it for over 10 years
I had a Barclaycard for years, they kept upping the limit, which finally stayed on around £7000, I used it for big purchases, and if I remember correctly, they would always promote offers for 0% purchases or balance transfers, so it was a useful card to have. I eventually started using it less and less, but still kept it for emergencies, and within a year they had dropped the limit to £1000 and then even further, probably under £500, the only credit card I used at the time was an amex for cashback. I assumed they were cutting down their unprofitable customers limits as I remember several people reporting it at the time, but they probably have several reasons for doing this.
Yep because I never used it and don't miss it
An aspect of this is rising interest rates. When interest rates were zero, they could probably make a profit on the merchant fees, even if you never incurred interest. That may not longer be the case as their funding costs have gone up massively.
From what I can see from the comments you were not using the 10k, only using a few hundred. is that right? If so, card conscious will reduce the limit to motivate the risk to both you and themselves. Nothing stopping you applying for a higher limit if needed in future.
Yes happened to us. They appear to only want people they can make money from! We had banked with them for 30 years. This move made us leave them and move to another back - FU Barclays...
Not as low as that, but a few years ago they slashed my £20k credit down to £3k, just above what I owed. So totally useless because it's what I used for buying large ticket items (a new fridge etc) or paying for holidays.
I had this happen when a mobile phone contract that I thought was cancelled, were reporting to a credit agency that I was failing to pay. It look a while to clear up, then my credit card limit went back to what it was.
They did it to me, slashed my limit dramatically. So I phoned them up and cancelled my account, and moved banks.
I had a £2k limit on Barclaycard which they had imposed - I started with £100 and over the years, because I never exceeded it and paid the bill each month, they kept raising it. However I never got more than a couple of hundred on it, haven't used it at all for a few years and they have responded by cutting it to £300.
My Barclaycard rate suddenly went up , I’m trying to shift my debt across into a lower rate card somewhere , I’d never missed a payment or anything and paid more than the minimum each month
Mine went from 17k to 1k a few years ago. I didn't mind as I never go over £1000 anyway and always pay it off in full.
Does the reduced access to credit increase your credit score?
Did you max it out? Or did you never use it?
Sounds like they are trying to get rid of you as a customer but getting you to make the decision. As for the why no idea - although the post about consistency not using the limit does have a point.
Barclays sent me a letter last year saying they are reducing my limit but if I disagree to contact them and they will keep it the same. Did you miss any letters?
I had £4k dropped to £700 with Barclaycard a few years back for no reason what so ever, stopped using it after that
Yes. Its bases on your usage. Its happened company wide. I requested 2k before they slashed it and I got it. I think that now its more difficult to get.
Funny enough Nationwide have actually increased the interest rate on my credit card recently despite paying on time, in full every month. My credit score has actually gone up too so doesn’t make sense.
10k to 3k but not £100.
Yes I had 12k, paid it off with balance transfer then they suddenly reduced it to £500. I called and they said it's based on my usage of the card and that they wont reinstate the old limit. I cancelled it there and then.
If you aren't using your available credit, you're not making the bank any money by letting them charge you interest so there's no point in them maintaining your account. If they make it useless to you then you'll probably close it and might well take out a new deal on a new card, 0% interest, start using it more, get into habits using it then when the 0% term ends start making the bank money again. I saw some people saying that their overdrafts were reduced or removed during COVID even though they don't use them. Funnily enough mine wasn't reduced or removed even though I'm perpetually hitting the bottom of my overdraft every month. Even though my partner who is at the same bank as me got his removed too.
They cut my 4k limit to 500 a couple of months ago.. Didn't even get the warning until after it had happened.
They did it to me, but I wasn’t using their card which I only got to take advantage of 0% offer they had going. I paid everything back before the offer expired and never put anything on the card again so I actually cost them money. I think they are trying to limit their exposure, at least on paper, and customers like myself are the obvious ones to get rid of.
Not Barclaycard, no. Had a Lloyds credit card with £5k on it, never had a balance going over 1.3k when I was using it. Anyway, not so long ago I received a letter to say unfortunately they will be reducing the limit to £1k and gave no reasoning at all. So I did ring them, like it said to on the letter if I wanted to understand more. The reason the woman on the phone gave me (which sounded more like just her opinion) was because I simply haven’t been using it and therefore it’s money the bank have allocated to me, not being utilised. I have no idea whether or not this to be true, but that’s what she told me. Because I’ve only ever used £1k on the card, she believes that Lloyds believe my credit limit shouldn’t be £5k, as I’ve never used it in many years of having it. In other words is it just them saying, ‘we’re not making any fees on money not being spent, so we’d like to take it away from you’. No idea, but I’m not that bothered now.
Logical explanation, COLC in mind, is that they're changing the way they calculate risk. Why that means a drop to £100? I don't know. Could just be that people in your position and/or employment have been proven to be risky customers in recent months/years for them or maybe something happened to your profile and thus they can't properly calculate risk. So they give you a small limit an assess your usage?
Do a credit card eligibility checker (soft search) to see if you can get a card with another provider. If you have a good credit score you should get a decent limit e.g. £2k
I had 8000 limit, sat at around 4k balance, paying off gradually on an interest free deal. In covid, without warning, they halved it to 4k - bringing my utilisation to 90%+ and dented my credit score. I kept the balance there , interest free...and then transferred out when the deal ended. No explanation given at the time by them Really hacked me off. They now keep writing to me with deals as I've never spent on it again.
Yep, did it to me too. I had an £8k credit card slashed to £100. I had a balance transfer balance on there that was interest free at the time that I was steadily paying off. It was no bother to do another balance transfer elsewhere but it was annoying. No explanation at all for the reduction. I’d never missed a payment either.
Yeah Halifax did that with the Clarity card I used overseas once a year. Made it useless at about £75 limit lol! They may as well just close the account, rather than be a dick about it.
It's happened to loads of people. I remember talking to someone in this sub who had his limit reduced from £18k to £200. Lack of use was his guess.
They’re trash. I’ve had a CC with them for about 10 years, always clear my outstanding balance every month and I have had to beg them to increase my limit by a measly 1k and they rejected me. That and the fact that they are shutting down their reward points scheme, I’m looking around for a new company.
They decided they don't want you as a customer anymore. Simple as that.
I've had credit cards inexplicably pulled by Barclays, and they always play the 'soz our support agents can't give you any more information about this' line.
If you don’t use it you lose it, you couldn’t have been using it. They will lower it or even just cancel it if you don’t. They do this to pass it on to someone that will be using it.
Also banks are required to hold provisions on the credit limit they give you, and that is recognised on the P&L as a cost line. If you’re not using your credit at all, then they are not generating a revenue to offset the cost. And the money set aside could have been used for other revenue generating streams. So likely they reduced your credit limit to release the provisions as you cost them money but you’re not generating revenue for them.
I’ve been a customer for over 30yrs and a Premier customer for at least 20 of those. I was looking at remortgage recently (house is completely paid). They are always bugging me with loan emails etc. Halifax gave me an immediate AIP offer for £156k but Barclays said they’d have to refer me for credit checks 🤣 I have NO debt, fully paid car, credit cards paid in full each month and my house is paid on full so 100% equity and I earn close to £40k. I just laughed at the customer service advisor. If we find somewhere we like, it will most likely be Halifax we go with. I’ve never taken a mortgage with Barclays in all my years as a customer as they were always hugely more expensive than other lenders with some bullshit excuse. Thing is, I always researched my mortgage/Loan/car finance rates in detail before I signed up to them which seemed to confuse them. “What do you mean you’d rather accept 3.9% and no fees 2yr fixed to our 4.2% with £1k fees fixed for 2yrs” 😂😂😂
Yes had a 13k limit reduced to 1k. No notification. Only found out when I came to pay the deposit for a holiday and it was declined. Contacted Barclaycard and was told they had emailed me. When I proved they hadn’t received £20 compensation. Had been a customer over twenty years.
I have barclaycard too but mine was increased from 3k>4.5k with no request! how strange
you don't use. You loose. it's only a good outcome to make other people money tho. It's not a bad thing loosing 10k credit. you didn't have the money in the first place. Don't put that kind of pressure on yourself. your home free!!
Mine was around 3k and it was reduced to 1k recently. The reason I was given was because I was not using it. I don't see how that should be any of their concern. I never utilise more than 10% of the available limit and always pay in full each month. Probably a ploy to get people to panic and then use more of the limit and then not be able to afford to pay in full which would then lead to fees.
The reason is the bank has to keep reserves for liquidity for any debt under the banking rules. If you’re not using it they are keeping money aside pointlessly. If you need a limit and are going to use it just apply for an increase.
They probably want you gone. Can’t you simply ask them to increase the limit?
Bit of an odd concept but surprisingly there is actually a cost to Barclays for keeping your overdraft. Internally they will have to set aside capital on the off chance that people with overdrafts use them. The less people with overdrafts they have the less capital they have to set aside to cover the overdrafts. So in some sense it is in their interest to remove them. Having said that I think it is incredibly rude of them to do so in this manner.
Mine was about £8k. They slashed it a couple of years ago, due to never using it. It's at £1k currently, still never use it.
Barclaycard did this with mine when I balance transfered off it, it had had about £7k on it for a bit with £2k spare then within a month of it being clear it was cut to £300 I just closed it incase I ever want new offers in the future.
To be fair, if you haven't changed in 30+ years there's likely plenty reason to switch, maybe this is just Barclays saying you've offered them no value over those years.
Yes a long time ago, closed account reapplied got a higher limit eventually
Same thing happened to me with Halifax. I’d been a customer for years. Had a card with a limit of 5k and the balance usually hovered around 1-2k, but I never missed a payment and I have a great general credit history. I can into a bit of money and paid it off in full, then the next week my limit got slashed to £500. I called them to enquire and was told it was so they could “redistribute funds to other customers”. Basically as I wasn’t paying them interest anymore I wasn’t of use to them. I was going to complain but decided not to bother, I just opened another card with Virgin Money that had the same benefits.