What is a credit card limit?
How does a credit card limit work?
A credit card limit is the maximum amount you can borrow on your credit card at any given time. As you make purchases, your available credit decreases. When you make repayments, your available credit increases again.
- Credit limit: The total amount you can borrow on your credit card Account.
- Available credit: The amount of credit you have left to spend after purchases, fees, interest or other charges have been applied to your Account.
For example, if your credit card has a $5,000 credit limit and you've spent $1,500, you'll have $3,500 of available credit remaining.
Your credit limit is not a spending target. It's important to only spend what you can comfortably afford to repay and to use your credit responsibly.
How is a credit card limit determined?
When a credit card limit application is assessed, a range of factors may be considered to determine an appropriate credit limit. These factors can include:
- Your income and financial circumstances
- Existing debts and financial commitments
- Credit history and repayment behaviour
- Information provided during the application process
- Responsible lending and regulatory requirements
All American Express Credit Cards have a maximum credit limit. Your highest limit will depend on your financial circumstances and the credit card you choose.
|
How can a credit limit affect your credit score?
If you apply for a product or request to increase your product limit, we will perform a credit check. A credit check is when we ask a credit reporting body for information about other products you hold, have held or have applied for, and whether you’ve satisfied your repayment obligations.
The credit reporting body will record the fact that we have done a credit check. This will show on your credit report as a ‘credit enquiry’, and it may be disclosed to other credit providers or used in the calculation of your credit score by the credit reporting body.
When a credit enquiry is recorded on your credit report, it can affect your credit score in different ways. It might go up, down, or stay the same. This depends on factors like the type of credit you're applying for, how many other credit checks you've had recently, and other details in your report. An enquiry is more likely to lower your credit score if you make a lot of credit applications over a short period of time. Learn more about managing your credit score |
How can a credit limit affect your credit score?
Cash flow issues often develop gradually, making early identification important. Some common warning signs include:
If you apply for a product or request to increase your product limit, we will perform a credit check. A credit check is when we ask a credit reporting body for information about other products you hold, have held or have applied for, and whether you’ve satisfied your repayment obligations.
The credit reporting body will record the fact that we have done a credit check. This will show on your credit report as a ‘credit enquiry’, and it may be disclosed to other credit providers or used in the calculation of your credit score by the credit reporting body.
When a credit enquiry is recorded on your credit report, it can affect your credit score in different ways. It might go up, down, or stay the same. This depends on factors like the type of credit you're applying for, how many other credit checks you've had recently, and other details in your report. An enquiry is more likely to lower your credit score if you make a lot of credit applications over a short period of time. Learn more about managing your credit score |
How can a credit limit affect your credit score?
If you apply for a product or request to increase your product limit, we will perform a credit check. A credit check is when we ask a credit reporting body for information about other products you hold, have held or have applied for, and whether you’ve satisfied your repayment obligations.
The credit reporting body will record the fact that we have done a credit check. This will show on your credit report as a ‘credit enquiry’, and it may be disclosed to other credit providers or used in the calculation of your credit score by the credit reporting body.
When a credit enquiry is recorded on your credit report, it can affect your credit score in different ways. It might go up, down, or stay the same. This depends on factors like the type of credit you're applying for, how many other credit checks you've had recently, and other details in your report. An enquiry is more likely to lower your credit score if you make a lot of credit applications over a short period of time.
Managing your credit card limit
You can apply for an increase anytime. If your application is approved, your new limit will be applied to your card within 15 minutes.
If ready to apply, please click the link below and enter the limit that you want to increase to.
In the application:
- Be prepared to provide recent documentation evidencing all sources of your income.
- Examples of income can include Salary, Rental Income, Dividends and any other regular earnings.
- If retired, you can include your latest superannuation statement confirming your closing balance.
We will review the documents you submitted along with the application information and consider the data from the Credit Bureau to conduct an affordability assessment before making a decision on your limit increase.
Learn more about Credit Bureau checks
You can request a decrease at anytime. When your request is sent through, your new limit will be applied to your card within 15 minutes.
If ready to request, please click on below link and enter the limit that you want to decrease to.
If you are ready to submit a request to lower your credit limit, please be aware of the following:
- If you have an outstanding balance, you cannot decrease your card limit below that balance.
- If you wish to decrease your credit limit to below your current balance, you will need to pay down your outstanding balance.
- Each American Express Card has a minimum credit limit, which you can find in the Target Market Determination fact sheet located under each of our cards on our website.
- If you are experiencing hardship, please call the number on the back of your card.
Tips on staying within your credit limit
1
Know your credit limit
This is the first step in making sure you are in control of your card balance.
2
Manage your balance
Making regular payments to manage your balance and reduce the chance of hitting your limit.
3
Make use of our tools
Login to your Online Account to check your balance or download the American Express® App to keep track of your spending and stay across your Card balance when on the go.
1
Know your Credit Limit
This is the first step in making sure you are in control of your Card balance.
2
Manage your balance
Making regular payments to manage your balance and reduce the chance of hitting your limit.
3
Make use of our tools
Login to your Online Account to check your balance or download the American Express® App to keep track of your spending and stay across your Card balance when on the go.
Frequently Asked Questions (FAQs)
You can select the credit limit that best suits your spending needs. American Express will assess your eligibility based on your financial circumstances to determine the limit that can be assigned to you.
Your minimum credit limit depends on the type of credit card you choose. The actual credit limit offered will fall between the card’s minimum and maximum limits and will not be lower than the minimum limit for that card.
Each American Express Card has a minimum credit limit, which you can find in the Target Market Determination fact sheet located under each of our cards on our website.
A credit card will have a set credit limit. In contrast, a charge card comes with flexible spending power, also known as no pre-set spending limit1. This means that with a charge card, the amount you can spend is dynamic and can adapt based on your transaction patterns, your personal credit rating, and other factors. You’ll also be required to pay the full closing balance on your charge card every month. Learn more about charge cards.
No, we are not able to make temporary increases to your credit limit. All credit limit increase requests require an application and assessment of your financial circumstances and ability to repay any higher credit limit you apply for.
Yes. A credit card limit may be reduced at a Card Member's request or in certain circumstances determined by the card issuer.
Please call the number on the back of your Card, and the team will be able to assist.
If you reach your credit limit, additional transactions may not be approved until sufficient repayments have been made to reduce your balance and restore available credit.
Monitoring your balance and available credit can help you avoid unexpected declines and better manage your spending
If you would like to explore changes to your credit limit, you can do so by applying online or by contacting us. Please note that the eligibility for an increase will be dependant on the following criteria:
- How long you have held your credit card
- Your repayment history
- Meeting our affordability assessment
1. Flexible Spending Power.
Unless we tell you otherwise, your American Express Charge Card comes with flexible spending power, also known as no-pre-set spending limit. This means that the amount you can spend is dynamic and can adapt based on your transaction patterns, your Personal credit rating, and other factors. The way you use your Card can help your spending power grow, particularly in the first few months. To help maximise your spending power, make regular transactions and don’t miss any payments. Please refer to your Personal Charge Card Agreement available here for further information.