Further limit reductions on credit cards could be in the pipeline

It has been claimed in a recent report that a growing number of credit card customers in the UK could see their credit limits reduced as credit card providers do their best to shore up their finances and claw back some revenue.

Since the onset of the global credit crunch many credit card providers have been looking at different ways to improve their own finances, and one of the ways in which this is being done is by decreasing credit card limits for customers and in some cases even closing the credit card account.

Some reports have suggested recently that credit card firms and other financial institutions may be easing up on credit restrictions, but some officials have said that with many credit card firms this is not the case.

Credit card companies are said to be exercising extreme caution still with regards to who they will offer credit to, and as part of their measures some have already reduced credit limits and even closed accounts of credit card users.

Officials from the Bank of England have recently said that it is likely that credit scoring will continue to become increasingly stringent as a result of lenders being more cautious when it comes to taking limits, and that this could mean reduced credit limits for many cardholders, which could pose a problem in the current climate where many people are more reliant on their credit cards.

The central bank also said that no mention of increasing credit availability had been made by lenders following recent meetings.

One major credit card provider has already estimated that around 50 percent of new applications are being rejected at present, and another has increased interest rates for cardholders that make late repayments.

Tags: United Kingdom, mention, result, interest, bank, credit, Credit Cards, credit card limits