I have been a long-time Citibank credit card (CC) user, charging most payments with plastic. You see, I don’t like bringing a lot of cash. Thick wallets are ugly, and mostly uncomfortable inside pockets.
I have lost the same CC twice and requested replacements. I have also forgotten online passwords and PIN codes, and paid penalties for delayed payments. But I have never hit the CC limit - until now.
I encountered my first issue when trying to update the CC expiration date in PayPal. This CC was a replacement to an expired card, so the update was necessary. But PayPal wouldn’t have it, and told me to contact my bank. So I called up Citibank, and was told that I had reached my limits. The next day, I tried to register the card again, and this time the CC update was accepted by PayPal.
I thought my woes were over, but NO. Every time I’d swipe my CC, I’d get a text (SMS) that my CC had reached its limits. I knew this to be impossible. After all, I knew my limits, and knew that my current expenses were only a third of that limit. So, I sent Citibank an email, and received this response some days later (with figures slightly modified):
Thank you for your message.
We would like to inform you that your account has already exceeded the limit as of today. Kindly refer to the details below:
Outstanding balance: P33,xxx.xx
Total outstanding installment balance: P59,xxx.xx
Outstanding floating balance: P16,xxx.xx
Credit Limit: P88,xxx.xx
There’s my culprit – Total outstanding installment balance. See, I had made purchases done on a 12-month PayLite 0% installment scheme. It turns out that the FULL amount eats up the Credit Limit every single month, even if I’m charged only partial amounts! With that, I’d be able to use up only P28,xxx.xx (Credit Limit - Installment Balance) every month, instead of the full P88,xxx.xx Credit Limit. SNEAKY BASTARDS!
So the next time you think about going on an installment with Citibank’s PayLite scheme, consider if the amount if safe enough not to cripple your Credit Limit.