[Answered with Details] What is a credit limit? 7+ information you need to know

1. What is a credit limit?

A credit card limit is the maximum amount of money that a bank or card issuer allows a customer to spend in a certain period of time. So what is the maximum credit card limit? Credit card limit depends on many factors, including income, credit history, collateral and each bank's policies. In Vietnam, credit card limits are often classified as follows:

• Basic limit: From 10 million to 50 million VND. 
• Average limit: From 50 million to 80 million VND. 
• High limit: From 80 million VND or more. 
• Special limit: Can be up to several billion VND, usually applied to VIP customers. 

There are two main types of credit card limits as follows:

• Daily spending limit: This is the maximum amount a customer can spend in a day. Customers can use this entire limit to pay online or swipe cards at POS machines. 
• Limit for cash withdrawal: This is the maximum amount a customer can withdraw from an ATM using a credit card. Normally, customers can use this entire limit to pay online or swipe cards at POS machines. 
• Limit for installment payments: This is the maximum amount of money that customers can use to buy products or services in installments by credit card.

2. Classification of credit limits

Credit limits are classified according to time and specific loan type as follows:

By loan time:

• Credit limit at the end of the period: Is the maximum loan balance at the end of the period and the actual loan balance is not allowed to exceed this limit. 
• Mid-term credit limit: An additional limit when the borrowing unit's business operations are unstable and the loan demand exceeds the credit limit at the end of the period. The additional loan amount must be repaid within the period to ensure it does not exceed the end-of-term limit. 

By loan type:

• Loan limit: Is the maximum amount that can be borrowed for each loan, disbursed according to schedule or at a single time. 
• Credit card limit: Is the maximum amount the cardholder can spend via the card, including direct payment and cash withdrawal (if any). This limit can be used multiple times a month to meet spending needs. 

3. Conditions for granting credit limits 

Conditions for granting credit limits may vary depending on each bank. Specifically, requirements often include: 

• Domestic enterprises must have a period of continuous operation of at least 12 months from the date of business registration, or have confirmation from the locality of the actual business period of over 12 months. 
• The business line must be consistent with the loan purpose and business plan of the business. 
• The business plan must be feasible, fully demonstrating financial capacity and debt repayment ability. 
• Businesses need valuable assets to guarantee the loan. 
• No bad debt at banks or other credit institutions. 

4. 5+ factors that determine credit limits

When a customer applies for a credit card, the bank will evaluate the credit profile based on a number of factors to approve and determine the credit limit, including:

• Income: High income often reflects good solvency and effective debt management. 
• Job profile: Stable work and regular income help increase your reputation for solvency. 
• Owned assets: Assets such as vehicles, insurance, houses or savings... can be used as collateral, minimizing risks for banks. 
• Credit history: The bank will check the customer's credit history, including previous loans and on-time payments. 
• Credit score: Credit scores are calculated based on factors such as payment history, current debt level, length of credit account opening, credit type, and new credit accounts. All of these factors will affect your ability to be granted a credit limit. High credit scores help customers easily get high limits. 

However, each bank or financial company may have its own criteria and methods for determining credit limits. 

5. 3+ ways to check credit card maximum limit 

When using a credit card, customers need to know how to check the limit to manage and use the card effectively. Below are 3 popular methods to help determine credit card limit accurately:

• Check at the bank: Go directly to the card-issuing bank branch, request to check the card limit, provide personal information and receive results from bank staff. 
• Check via Mobile Banking: Log in to the banking application, enter personal information, access the account information section and select check credit card limit to view detailed information. 
• Check via switchboard: Call the bank's hotline number, answer the verification questions and receive information about the credit card limit from the support staff. 

6. Instructions on how to change credit limit

To change your credit limit, you need to pay attention to the following specific conditions and procedures:

6.1. Conditions for changing credit limits 

To change your credit limit, you need to meet the following two basic conditions:

• Condition 1 - Income: To request an increase or decrease in the card limit, you need to prove that your current income is higher or lower than the income level when registering to open the card. In addition, if you have collateral assets such as savings books, life insurance contracts, or real estate documents, you also need to prove that these assets are more or less than when you opened the card to request a credit limit adjustment. 
• Condition 2 - Credit history: Your credit history will be evaluated based on factors such as: Paying debts on time, using cards for the right purpose, limiting cash withdrawals from credit cards, avoiding owning too many credit cards with the same owner at the same bank, controlling spending properly and not incurring new debt. 

6.2. Process for changing credit limits 

If you want to change your loan limit, you can follow this 3-step process:

• Step 1: Go to the nearest branch or transaction office of the bank to request a limit change. 
• Step 2: Provide personal documents to the teller and request to increase or decrease the loan limit. The bank will base on the documents you provide to approve the new limit. If you apply for a credit card through a deposit, you need to bring the deposit and fill out the limit change request form according to the instructions. The process is quite simple:
  • Fill out the credit limit change request form. 
  • Provide a copy of the most recent labor contract. 
  • Submit payroll statements for the most recent three months with bank confirmation. 
• Step 3: Wait for approval results. Approval time can take about 2-4 weeks, depending on the regulations of each bank. 

7. SeABank - Credit card with annual fee of 0 VND for life

SeABank is one of the largest joint stock commercial banks in Vietnam. With more than 30 years of experience in the banking and finance industry, SeABank always focuses on providing diverse financial services. Credit cards are one of the bank's outstanding products, bringing many utilities and attractive incentives to users. 

SeaBank provides a variety of limits with the following typical cards: 

• Signature credit card
• SeATTravel Visa credit card
• BRG Elite credit card
• Visa Platinum credit card
• BRG Golf credit card
• SeALady VISA international credit card
• SeA - Easy credit card
• SeALady MasterCard international credit card

With incentives such as free card issuance fees and lifetime annual fees, SeABank promises to be the ideal choice for those who want to enjoy maximum benefits from using credit cards. Contact us immediately via Hotline 1900599952 or access HERE for detailed information about each type of credit card. Watch more videos: Conditions for opening a SeABank credit card Types of credit cards and conditions for opening SeABank credit cards. Understanding what a credit limit is helps you use your card more effectively and take full advantage of the benefits it brings. By managing appropriate limits, you will easily control spending and build an appropriate financial strategy. To open a credit card at SeABank, please contact us via Hotline 1900599952 for the most detailed support!