Covid-19 pandemic has affected everyone’s life in many ways. Our economy has gone down, people have lost their jobs and certainly are on the brink of losing all their savings, because of no income. So, along with all this now the banks have started revising the credit card limits of their customers. This step has been taken to safeguard themselves from the ongoing salary cut and job loss, as the coronavirus pandemic is yet to be taken care of and set under control after all the extended lockdown. There is credit pressure for negative market sentiment and banks are reducing to avoid the risk of potential NPA. However, it’s not done for all but a certain segment of clients where the Bank using Data Analytics on client profile thinks them as risk-prone.
What Is Going On?
1. Axis Bank- According to a report, the credit card limit of around 200,000 people who have their accounts in Axis bank has been reduced with effect from April 15. Many people have even hit the credit limit, as bad as 90%.
2. Kotak Mahindra Bank- Kotak Mahindra have also reduced the limit of the credit card of the people who have their account in the bank.
3. SBI Cards- According to reports, there are cases being found on the internet which says that people are seeing a reduction of 60% in their credit card limit.
What Can We Do Now?
In this situation, there is nothing much that you can do. Although, you can keep a track of all the expenses you are doing with your credit card. Also, keep a track of the limit often, and carry another card within case you are going out.
The one thing that will be great is that if the issuer sends an immediate response or notification via email/sms regarding the charge on their credit card.
Conclusion
This certainly doesn’t come to us a surprise that banks have reduced the card limits, but the news that shocked people more is the revision of limits in the range of 90% which is definitely a bit too much. However, the banks must surely be having big data AI to back their actions.
Since the lockdown is extending we only are hearing negative news, this news is still small, and if the lockdown keep extending news like this will just keep growing.
We can certainly see a major impact on our credit limits on most of our cards, which can be stressful.
When there was no other option around the banks decided to reduce the card limit. We can only hope that this gets reverted once all this pandemic is over, or else people are going to suffer a lot.
