Credit cards: More and more limits are being reduced without notice

Customers are surprised when their financial institution lowers their credit card limit without notice.

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This recently happened to a self-employed person who complained about it to Le Journal.

She first paid off the $10,000 balance on her company card and then closed the account. She then paid $20,000 back to her personal card, leaving her balance at $16,000.

Without warning her, the financial institution that issued her credit card increased her credit limit from $36,000 to $16,000, reducing her flexibility.


“I think it’s exaggerated,” she said on condition of anonymity.

“It is clear that I am trying to restore my situation, but the bank is not taking my efforts into account,” she adds. They are doing this to get me to stop using my card.”

At Desjardins Group, we are aware that more members and customers are having their credit limits reduced than before.

“We have seen an increase in limit value reductions this year compared to 2022,” says spokeswoman Chantal Corbeil.

Pierre Fortin, president of Jean Fortin Financial Reorganization, is not surprised. He points out that many households’ financial situation has improved during the pandemic, prompting financial institutions to increase credit card limits.

Economic crisis

“There may be a slight return to normality,” says Mr Fortin. We see that banks have significantly greater difficulties in granting loans. It’s much stricter, the funding criteria is stricter because there’s certainly a slowdown [économique] Who comes.”

Credit cards More and more limits are being reduced without

Pierre Fortin with kind permission

In his opinion, financial institutions would do well to close the floodgates a little. “We limit the risk for people to get into debt,” he says.

The decision to lower a credit limit “depends on the individual risk assessment between a bank and its customers,” says Maggie Cheung, spokeswoman for the Canadian Bankers Association.

Notice not required

Few people know this, but financial institutions can lower the limit on a credit card without informing you in advance. However, they must inform the cardholder if they wish to increase their limit.

“We can do this without sending you a notice […] Reduce your credit limit, for example if your financial situation and your credit report change,” says the National Bank’s credit card agreement.

A spokesman for this institution, Alexandre Guay, assures that the number of reductions in credit limits is “stable”. […] in the last few months.

However, at Option Consommateurs (OC), we see Quebecers taking the lead and asking their financial institution themselves to lower the limit on their credit card.

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Johanne Le Blanc

“If we know each other and are having difficulty limiting our use of credit, this could be a solution we should consider,” emphasizes Johanne Le Blanc, budget advisor at OC.

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