Modern limits evolved from early department store charge accounts and the first bank-issued cards of the 1950s, including Bank of America's 1958 BankAmericard pilot in Fresno, California, and the Interbank cooperative formed in 1966.[2] Lenders generally set limits based on specific information about credit-seeking applicants, including income and employment status. Credit limits play an influential role on a consumers' credit scores and their eligibility to obtain future credit.[3][2][4]
Credit limits affect credit scores primarily through credit utilization as the percentage of available credit consumed. Credit scoring models like FICO and VantageScore weigh utilization heavily — around 30% of the total score — with lower utilization ratios below 30% generally resulting in better scores, and the best scores typically associated with utilization under 10%.[5][6]
A line of credit that has reached or exceeded its limit is considered maxed out. When maxed out, the line of credit cannot be used for any further activity unless the consumer pays off at least some of the debt to enable it to fall below the limit, the creditor agrees to extend the limit, or the creditor allows one or more additional purchases with the charging of an over-the-limit fee.
Oversight expanded after Congress amended the Truth in Lending Act in 1968 and the Credit Card Accountability Responsibility and Disclosure Act of 2009 curbed over-limit fees.[2][7] Total credit lines across U.S. consumer cards surpassed $5 trillion in 2022, and growth since the pandemic has been concentrated among borrowers who qualify for the largest limits.[7][8]
History
Predecessors to modern credit cards in Babylonian and Roman antiquity regulated loan size through interest rate caps not credit limits, and merchant Charga-Plates kept per-customer limits hidden from the consumer inside store ledgers. Department stores, railroads, airlines, and gasoline companies issued private-label charge cards in the early twentieth century so that customers could buy on account.[2][9]
National banks broadened that model after World War II—Diners Club launched in 1949, while Carte Blanche and American Express introduced travel-and-entertainment cards in 1958 without pre-set limits.[2]BankAmericard debuted in California in 1958 when Bank of America mailed 60,000 unsolicited cards with pre-set limits of $300-500 to Fresno residents, enabling rapid merchant adoption before spreading via interstate licensing in 1966 and rebranding as Visa in 1976.[2][10]
Interbank, a consortium of banks that issued the Master Charge card in 1966 with lower initial limits between $50-100, ultimately became MasterCard, while numerous regional bankcard groups served local markets during the 1960s with similar credit limits.[2][11]
Regulation
Rapid growth in bankcard issuance, including mass mailings of unsolicited cards, triggered consumer protection concerns. Congress responded by amending the Truth in Lending Act in 1968 to restrict unsolicited cards, require clearer disclosures, and assign enforcement to the Federal Reserve and other bank regulators.[2] A national commission later evaluated proposals for a Federal Reserve operated card network, opting instead to let competing private networks build the switching infrastructure that supports credit limit management and settlement.[2]
By the late 1980s most bankcard networks had moved authorization online within seconds. Issuers began to combine bureaucredit scores with real-time transaction data to adjust individual credit lines instead of relying on the static limits of the 1960s. A 1994 Government Accountability Office study found that issuers routinely approved or declined purchases after checking the cardholder's current limit inside VISA or MasterCard's switch and could revise that limit upward in minutes for low-risk customers.[12]
United States regulations shifted from prescriptive limits to an ability-to-pay test under the 2009 Credit CARD Act and its Regulation Z rules. A card issuer may not open a new account or raise a line unless it has reasonable policies to verify income, obligations, and the minimum payment the borrower can afford.[13]Experian data show that the average American could access $29,855 in combined credit lines in the third quarter of 2023, up 6.8 percent from 2022.[14]
Global limits
FICO's monthly benchmark indicates that the average UK credit card carried a £5,830 limit in March 2025 after rising 3.1 percent year-over-year.[15] The European Union's second Consumer Credit Directive, adopted in 2023, does not cap card lines, instead requiring a documented credit-worthiness assessment, a ceiling on fees, a 14-day withdrawal right, and clearer advertising across all consumer credit up to €100,000.[16]
The ECB's 2024 SPACE survey found that cash still settled 52 percent of point-of-sale purchases across the euro area, while debit cards covered another 32 percent, leaving credit cards as a niche instrument.[17] In Germany credit cards accounted for only 6 percent of transactions in 2023 and just 10 percent of total expenditure; mainstream personal limits typically start near €500 and rarely exceed €10,000.[18][19] French banks rely on monthly bill-pay "cartes à débit différé," and revolving balances were only €21.9 billion in July 2025, a small share of the €215 billion consumer-credit market.[20] Nordic consumers are nearly cash-free with Swedish mass-market cards cap limits between SEK 100,000 and 150,000.[21] The 2024 revision of the EU Consumer Credit Directive harmonizes affordability checks and fee caps, reinforcing the region's preference for restrained credit issuance.[22]
In Singapore, Monetary Authority of Singapore regulations limit most cardholders earning S$30,000-S$120,000 a year to a permanent line no higher than four times their monthly income. Individuals below S$30,000 face a two-month-income ceiling, while those above S$120,000 have no regulatory cap.[23] India's 2022 Reserve Bank directions require issuers to obtain explicit customer consent before any limit increase and to re-evaluate repayment capacity, although no numeric cap is set.[24]
IMF Financial Access Survey data show that adults in advanced economies held an average of 1.5 credit cards each in 2023, while ownership was negligible in most of Sub-Saharan Africa where mobile money dominates.[25] The same dataset reports that debit cards now outnumber credit cards worldwide, with emerging Asia averaging four debit cards per adult.
Limit issuance and management
Credit card companies determine credit limits by evaluating an applicant's financial profile, including income, employment status, existing debt, and credit history. Higher limits are typically granted to borrowers with stronger credit profiles.[1][26] As of 2022, total U.S. consumer credit card limits exceeded $5 trillion, with the ten largest issuers representing over 80% of outstanding balances.[7] Credit card companies regularly review and adjust credit limits, with data showing that in 2022, approximately 4.6% of general purpose accounts received automated credit line increases each quarter.[7]
Average credit line per account by credit score tier, United States 2022[7]
Credit score tier (FICO)
General-purpose card
Private-label card
Superprime (800 or higher)
$12,529
$3,714
Prime plus (720-799)
$9,428
$3,366
Prime (660-719)
$5,587
$2,486
Near-prime (620-659)
$3,067
$1,617
Subprime (580-619)
$2,059
$1,225
Deep subprime (579 or lower)
$1,521
$998
By late 2024, cardholders at the 90th percentile had credit limits of $19,500, while the median limit remained around $5,000, clustered with respective high and low credit scores.[8][7]
Recent data show an increase in minimum-payment-only accounts and elevated delinquency rates through 2022 and 2023.[7][8]
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