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My take on the impending CLDs (if it continues to happen) is AmX way of having more unreserved money in its coffers to increase its number of members.
An example. Does AmX want 20 members with $30K CLs using 1-5% of their limit or do they want 60 CC holders with $10K CLs using 30% of their CL.
@saeren posted an article last week that AmX millennial card base is growing (don’t recall exact words, a disturbingly long article) and I’m assuming they’re going to really target this market. So, IMO, cutting unused CLs in half would be the most financial and business thing to do.
So, I’ve started checking my ED at least once a day. And, if mine is slashed, I’m OK with AmX decision. What I won’t do is ask for a 3X CLI on my Magnet. 😂🤣
@CJ7 wrote:
, but I argue that other creditors don't typically reduce credit lines for reasons unknown
or "Change Policy". I've done nothing wrong and suddenly I'm trusted half as much as I was
yesterday.
Almost all issuers change policy on a regular basis, rarely give a reason, and if they do is most likely a lie.
Barclay's started cutting CL's and closing accounts at least 5 years ago and C-One a couple or three years ago. C_One created a mess with combining card limits on cards you were closing to other open cards, no question asked. People had $70,000 CL on worthless cards with no use. C1 started fixing the problem they created both with policy change and no reason. Amex has been CL increase/high limits happy for quite a while. Now time to fix the policy that created the problem.
US-Bank adds and deletes categories on a regular basis, making some happy and others mad. (Never a reason given). New category this next month, helps me/hurts others. Some credit cards just go away, yes I lost my "SalieMae", and was "Not Happy" either. (No reason). BofA just opened CL increase request as SP's from HP. (Happy People / No reason)
Changes in policy occur all the time, and across almost all issuers.
This month a change hurt you.
Next month a change might help you.
The mental gymnastics on this site attempting to make American Express something that's is not is actually entertaining.
My personal favorite on this thread is a reference to the "type of customer who has BCE". Is it the type of customer who had BCP then downgraded when American Express decided to pay 1% for grocery rewards after approximately $1500 or spend?
I do have a question or two. If American Express is the be all and end of lenders why did the credit limits go so high before they realized the amount of spend did not justify the limit if that is the reason for reducing credit limits?
I am frequently offered a 5% dicount for cash or check payment, 3% for Master or Visa. Is this because merchants love American Express?
@Anonymous wrote:Good post from CB14 above.
Any BCE cardholder that has very high (say, $25k+) limit no doubt has other rewards cards as well. I think it would be very rare to find a high limit BCE cardholder that has only that one card and uses it as their daily driver. That being said, as CB14 points out the card is quite meaningless outside of the 3% grocery category for the majority of people that have a few other cards. So then it comes down to how much can one really spend in a cycle on groceries? Definitely not enough to support "needing" a $25k+ limit, that's for sure.
Just to be clear, I'm not saying it's very rare in the general population. By "hardly anyone here" I mean hardly any MF members.
Sample selection bias is very much at play! People who participate in a credit card forum are certainly more likely than the general population to have a complicated rewards strategy or seek a CLI just for the sake of "padding" or entertainment.
There maybe many people using a BCE as a daily driver...but they're not likely to be reading this thread!
I’m certainly not an economist, and heck, I’m limited to only what I’ve read, but I can’t help but think AMEX is reducing their risk. Everything I have read, the economy is slowing down. Consumers are spending less, and home prices are on a slight decline.
I agree with BBS, unless you are a high income earner, there honestly isn’t any reason to have these ridiculous cl amounts. How much does one really need for utilization with respect to ones income? I suspect with some, part of this is just bragging rights, and not really “I need these exorbitant cl amounts”
@NRB525 wrote:
If you are being “steered” to use something other than AMEX, even for a discount, that merchant is violating AMEX Merchant Terms of Service. There was a Supreme Court case last year, decided in AMEX favor, that merchants can not do this, if they accept AMEX at all.
I'm not being steered. I'm offered a discount.
@Save-n-Invest wrote:The mental gymnastics on this site attempting to make American Express something that's is not is actually entertaining.
My personal favorite on this thread is a reference to the "type of customer who has BCE". Is it the type of customer who had BCP then downgraded when American Express decided to pay 1% for grocery rewards after approximately $1500 or spend?
I do have a question or two. If American Express is the be all and end of lenders why did the credit limits go so high before they realized the amount of spend did not justify the limit if that is the reason for reducing credit limits?
I am frequently offered a 5% dicount for cash or check payment, 3% for Master or Visa. Is this because merchants love American Express?
I'm not totally clear on what you're saying. I'm saying that within the population of credit enthusiasts with good history and income, there probably aren't many who spend a lot on BCE.
If Amex didn't recognize your local merchant as a grocery store, and you can get a discount with a different form of payment, then you shouldn't use BCE there.
I'm not clear on whether you're disagreeing with me or just generally complaining about Amex. I described BCE as "pretty mediocre" and not "the be all and end all". Now maybe if they removed the BBP cap...
My understanding is that discounts for cash are allowed, but anything that treats one card differently from another card is steering.
Cash discounts don't really play a role for me. Most of my grocery spend is at Costco (Visa only), and I have a Square Cash App Visa debit card coming in the mail for 10% off at Trader Joe's - provided by the app and NOT by the merchant.
@Save-n-Invest wrote:
@NRB525 wrote:
If you are being “steered” to use something other than AMEX, even for a discount, that merchant is violating AMEX Merchant Terms of Service. There was a Supreme Court case last year, decided in AMEX favor, that merchants can not do this, if they accept AMEX at all.I'm not being steered. I'm offered a discount.
The merchant will not say “I would like to steer you away from using your AMEX card” but the industry terminology for this discount offer is indeed “steering”.
https://en.m.wikipedia.org/wiki/Ohio_v._American_Express_Co.
@06GTS197 wrote:
Hi, just logged in to Amex and noticed my limit got cut from 30k to 15k. Nothing on my profile has changed. The only thing I can think of is I haven’t used the BCE in a month because another card has been serving my grocery needs for cash back.
Any idea why Amex would do this?
Fourth quarter 2018 profit for American Express was lower than expected because of their credit card rewards expenses, and their stock price subsequently went down, so American Express is probably making changes related to their rewards cards.
BTW, I just voluntarily lowered my American Express credit limit for the second time. I'm planning to apply for a low-interest credit card in two months, so I'd rather have a higher credit limit on that card, assuming I will be approved for it.