Barclaycard has slashed credit limits of its customers by thousands of pounds after raising the limit last month.
The company sent letters to customers stating that they may have set their credit limits ‘too high’ for some customers.
A spokesperson for Barclaycard said: “An internal review of our operating procedures for credit card limits highlighted that we did not always meet the expected standards for assessing a customer’s situation, meaning that not all of the customer’s circumstances and/or finances may have been considered as part of their application.
“As such, in a small minority of cases, a limit was set that may have been higher than it should have been at the time.
“In order to put things right, we have written to the vast majority of these customers to apologize for what has happened and to give them the opportunity to let us know whether they feel their credit limit has had a negative impact on their circumstances, or whether they incurred any losses.”
Barclaycard has advised the affected customers to contact the company directly and has promised to assess each case on an individual basis.
The move is in compliance with the UK’s Financial Conduct Authority’s (FCA) mandate that banks’ should make sure a higher credit limit is “affordable” before they increase it.
The move comes at a time when banks in the UK seek to reduce risks due to the economic downturn caused by the Covid-19 pandemic.