Toronto Man Has Limit on Line of Credit Cut by $12,000 Without Being Informed by Bank


Since the COVID-19 pandemic started, banks and other financial institutions have been reviewing credit limits on credit cards and lines of credit and in some cases cutting them without notice.

“They just took it away and didn’t say a thing to me,”

said Patrick Garel of Toronto, who had a credit line with his bank for more than 25 years.

Garel said he likes to have an extra amount of credit available in case of an emergency and to help his daughter Alicia, who just completed medical school and is now a front-line medical practitioner helping COVID-19 patients.

The man was recently online checking his accounts only to find that his credit limit had been cut by $12,000 from $24,000 to $12,800.

“I don’t touch that money. I leave it there just in case I run into problems which during COVID could happen,” said Garel.

At the start of the coronavirus pandemic, some lenders additionally reduced limits on credit cards. It has also been going on with credit lines so as banks can prevent further risk when lending.

Garel banks with Scotiabank and complained to his branch and the company’s Ombudsman.

When the media reached out to the bank, a spokesperson said they

“cannot comment on individual customer matters for privacy reasons.”

“However, we can advise that we do regularly review our line of credit accounts and we may make changes to credit limits as permitted under the terms and conditions of our credit agreements for those accounts.”

The spokesperson continued:

“We remain committed to helping our customers who may be experiencing hardships due to the COVID-19 pandemic and encourage customers to contact their financial advisor or 1-800-4-SCOTIA to discuss their options and to ensure that they have the products and services that best meet their needs.”

Garel wants at least some of his credit line restored.

“Even if you’re not going to put it all back, put back some of it,” Garel said.

He said when his limit was reduced, it also negatively affected his credit rating.

If an individual has their credit limit lowered, one can appeal. However, if you keep your credit in good rating, always pay the amount due every month, and if you can, go even beyond the minimum payment and always try to make your payments on time.

Banks might as well close dormant credit cards or accounts that are not being used. So if you have a card stored away in your wallet or in a drawer, you should use it occasionally, or it could have its limits reduced or even canceled.


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