Not upheld: credit limit reduction and service failures complaint against Barclays Bank UK PLC (trading as Barclaycard)

Decision detail

Summary

Mr T complained to the FOS about Barclaycard's reduction of his credit limit following incorrect adverse information on his credit file, and about poor service when attempting to resolve the issue. Although Barclaycard acknowledged service failings and paid £100 compensation, Mr T sought a higher award, claiming the limit reduction was disproportionate and that he lost savings interest. The ombudsman found no error in the limit reduction as it was in line with Barclaycard's lending policies and the firm could not have known the adverse information was incorrect. The ombudsman upheld Barclaycard's £100 compensation as fair and reasonable for the service failures and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman found that lenders are expected to review credit limits when a customer's credit profile changes, and Barclaycard could not have known the adverse information was incorrect. The limit reduction was in line with policy and was promptly restored once the error was discovered. Regarding service failures, while Barclaycard acknowledged multiple failings, the £100 compensation was considered reasonable given the severity, duration, and impact of the issues, and was in line with typical FOS awards.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website