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Credit Cards Slash $99 Billion From Spending Limits During Pandemic

Some people had complained as limits began dropping. Now the full scope is emerging.

RF Credit card Hands of man holding wallet and blank white credit card

Photographer: Westend61 via Getty Images 

The notices went out to one cardholder after another, sparking complaints. Big banks were trimming credit limits by hundreds or thousands of dollars as the Covid-19 pandemic spread. None were saying how far it would go.

The answer: The 14 lenders that dominate U.S. credit cards slashed $99 billion from their customers’ spending limits in 2020, mostly affecting financially troubled households. It’s the equivalent of cutting $2,000 in financing to 50 million people -- many of whom lean on cards for emergencies.