Calibrating a credit limit during underwriting is essential, but the line should undergo periodic review to ensure it serves the cardholder’s requirements and the issuer’s risk appetite. Credit card issuers often review accounts for line increases throughout the cardmember relationship. Still, our observation in the field is that fewer issuers practice credit line decrease programs as a regular part of their account management process.

Surgically decreasing credit lines on a targeted basis will remove unnecessary credit risk and protect against operating expenses if the cardholder’s financial status shifts during an economic downturn.