A guide to credit card limits

What is a credit card limit?

A credit card limit is the maximum amount that you’re approved to borrow on your card at any one time. This will be defined before your credit card agreement is confirmed, but can be adjusted over time.

There are low limit credit cards starting at around £200, but for high limit credit cards, the amount you can borrow will vary from lender to lender and there isn’t a set maximum credit card limit in the UK. It will depend on the lender you apply with and your own financial situation.

The average credit card limit in the UK is between £3,000 and £4,000.

How do credit card limits work?

When you apply for a credit card, the provider will look at a range of key factors to decide what credit card limit to offer you, such as:

• Your gross annual income
• Your previous repayment history
• Any other outstanding loan and/or credit card balances you have in place
• Other credit accounts such as a mortgage
• Any past financial issues such as bankruptcy or civil judgments

As long as you can show that you earn a certain amount and don’t have a history of missed payments, bad debt or other financial issues, there’s a good chance you’ll be offered credit.   The lender will let you know the approved credit card borrowing limit if your application is successful.

Can you increase your credit card limit?

If you already have a credit card and are looking at how to increase your credit card limit, this would usually happen in one of three ways:

• If you keep up with your credit card payments over an extended period of time, and particularly if your salary increases, your lender might offer to increase your credit card limit.
• You could contact your current lender to apply for a credit card limit increase yourself and see if they approve it.
• Alternatively, you could shop around for a good credit card balance transfer deal with a new lender who might offer a higher credit card limit than you have now.

If you already have a credit card with Sainsbury’s Bank and want to talk to us about how to raise your credit card limit, please get in touch with our team today.

Can you go over your credit card limit?

While many lenders will allow you to go over your credit card limit, it’s not a good idea. It will most likely come with a penalty charge, and it could affect your credit score.

If buying something is going to take you over your credit card limit, your card will probably be declined when you go to pay, but it is not only purchases that can put you over the limit.

If you’re paying monthly interest on your card and you’re close to your credit card limit, the interest could take you over your limit and trigger a penalty. The exact amount charged for this will depend on the lender and the terms of your credit card agreement.

As such, it’s a good idea to try to make sure you never get too close to your credit card limit, if possible. You should view your limit as a short-term emergency buffer, rather than something to use regularly.

Do credit cards have a daily limit?

Some credit cards can have a daily spending limit and/or maximum single transaction limit. This is predominantly a fraud prevention measure, to stop someone from racking up huge charges in a short space of time if your credit card details are hacked or stolen.

It’s worth looking through your credit card agreement or asking your lender about any daily credit card limits before you accept your terms, to make sure they fit your financial needs.

What is a good credit card limit?

Your ideal credit card limit will depend entirely on your financial circumstances and how you want to use your card, which could of course change over time. 

Some people use their cards for regular, everyday purchases, such as weekly food shops or petrol, and pay their bill in full each month. Others only use their cards for occasional bigger buys, like a holiday or a new washing machine, and pay it off in increments. All of these options and possibilities should be factored in when you consider what a good credit card limit would look like to you.

So, essentially, a good credit card limit is one that suits you. We can help you find it.

Need help?

Have a look at our credit card support section, with lots of useful FAQs and other relevant information, or get in touch with us.