Survey shows 21% of those who lost a job or income since March 1 have also experienced a reduced credit card limit
Foster City, CA – July 29, 2020 – While many Americans could be relying more on credit cards following a job loss resulting from the pandemic, a recent CardRatings.com survey reveals those with job or income loss are more than twice as likely to see their credit limits reduced unexpectedly.
The leader in credit card ratings finds banks reduced credit card limits for 21% of survey respondents who lost jobs or income since March 1. In addition, people who lost income are more likely to shift the way in which they spend with credit cards than those who haven’t lost income.
- Increased credit card spending: 23% of people who’ve lost income vs. 16% of those who haven’t
- Decreased credit card spending: 45% of people who’ve lost income vs. 31% of those who haven’t
“There are plenty of anecdotes about people seeing cards suddenly closed by banks or even people with excellent credit having more trouble getting approved for a new card,” says Brooklyn Lowery, senior manager of CardRatings.com. “An unexpected reduction in your credit limit could, however, be just as distressing.”
Having one’s credit card limit reduced, or a card closed, can have long-lasting effects on a person’s credit score, she explains.
The survey also reveals 9% of respondents who had no change in their income had their credit limits reduced. CardRatings offers guidance and suggestions to those who may have been hit with a limit decrease.
Customers can also take steps to decrease the likelihood of a bank reducing their credit limit or closing their account:
- Regularly use all credit cards: Banks are more likely to reduce limits on or close accounts that are dormant.
- Regularly assess credit card needs: As job and lifestyle situations change, so do credit card needs. For instance, it may be time to replace the high annual fee travel card for a credit card with no annual fee or a cash-back credit card.
Find the full report and survey results here: https://www.cardratings.com/lost-income-banks-are-more-likely-to-reduce-your-credit-card-limit-survey-reveals.html
Lowery is available for comment.
Methodology
CardRatings.com commissioned Op4G to conduct a national survey. The sample size was 800 people, with half reporting having lost income/jobs since March 1, and responses were collected June 23-30, 2020. The margins of error for all non-multiple choice questions ranged from 2.77%-3.46%.
About CardRatings.com
CardRatings.com is owned and operated by QuinStreet, Inc. (Nasdaq:QNST), a pioneer in delivering online marketplace solutions to match searchers with brands in digital media. QuinStreet is committed to providing consumers and businesses with the information and tools they need to research, find and select the products and brands that meet their needs. CardRatings.com is a member of the company’s expert research and publishing division.
CardRatings.com innovated online credit card ratings and has been offering independent ratings and reviews of credit card offers since 1998. The website collects and maintains data on more than 700 credit card offers and carefully compiles objective lists of the top credit cards by card type, making it easy for consumers to find the right card to fit their needs.
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Media Contact
Charlene Arsenault
Media Outreach Specialist
508-832-8918
carsenault@quinstreet.com