Last updated: 4 November 2026. General information for the UK, not regulated financial advice.
A message pops up in your banking app: “Good news! Your credit limit has been increased to £4,500.” Or a letter arrives saying it will go up next month unless you say no. Is that good news? And what about the old credit card in your drawer you haven’t used in years: should you close it?
Both questions come down to the same thing: how much credit you have available, and whether it helps or tempts you. Here’s how a credit limit increase affects your credit score, when to say yes or no, and when to close an unused card.
It’s part of my debt and credit UK guide.
How your credit limit affects your credit score
Lenders and credit reference agencies look at your credit utilisation: how much of your available credit you’re using.
- £500 on a £1,000 limit = 50% used.
- £500 on a £4,000 limit = 12.5% used.
Using a smaller share of your limits usually looks better, because it suggests you’re not relying on credit. So a higher limit can lower your utilisation and help your score, as long as your balance stays the same.
But lenders also look at your total available credit. If you have lots of unused credit, a mortgage lender may think about what would happen if you used it all, and that can affect how much they’ll lend you.
Should you accept a credit limit increase?
It may be worth accepting if:
- You always pay in full and won’t spend more just because you can.
- You’re close to your limit with normal spending, so a higher limit brings your utilisation down.
- You’re not applying for a mortgage soon and won’t need to keep your total available credit low.
- The increase came from the provider, not from you applying (you asking for an increase may mean a credit check).
It’s usually best to refuse if:
- You carry a balance from month to month. A bigger limit can mean a bigger debt.
- You’ve been tempted to overspend before, or you use the card for things you can’t afford.
- You’re struggling with debt right now. If you’re only managing minimum payments, more credit isn’t help. Read how to pay off a credit card faster instead.
- You’re applying for a mortgage in the next few months. Your broker may prefer you keep things steady.
There’s no prize for having a big limit. The right limit is one that covers what you can comfortably pay off each month.
How to refuse or reduce a credit limit increase
- Before it happens: the letter or message should tell you how to say no. Usually it’s a few taps in the app, an online form or a phone call.
- After it’s happened: you can ask your provider to reduce your limit back down at any time. Reducing the limit can increase your credit utilisation and may affect your score.
- Stop it happening again: the FCA says card firms agreed that customers can opt out of automatic credit limit increases. Ask your provider to turn them off.
The FCA also says people who have been in persistent debt for 12 months shouldn’t be offered limit increases.
Asking for a credit limit increase yourself
If you’d like a higher limit, for example to bring your utilisation down:
- Check how your provider handles it. Some do a soft search, some a hard search. Ask before you apply.
- Only ask if you pay in full or have a clear reason.
- Don’t ask for an increase to cover a cost you can’t afford. That’s a sign to look at your budget or speak to a free debt adviser.
Should you close an unused credit card?
This one depends on your situation. Here are the pros and cons.
Reasons to close it
- It tempts you to spend.
- It has an annual fee and you don’t use the benefits.
- You’re worried about fraud on a card you never check.
- You have lots of open credit and a mortgage lender may see it as too much available credit.
- An ex-partner has an additional card on your account. UK credit cards are not joint: the main cardholder is responsible for the balance. Ask the provider to remove the additional cardholder. If you also had joint accounts or loans, ask for a notice of disassociation once those financial links have ended.
Reasons to keep it open
- It’s your oldest account, which helps show a long credit history.
- It lowers your overall utilisation, especially if you have balances on other cards.
- It’s free and you trust yourself not to use it.
- It’s useful as a backup, for example abroad, for emergencies, or for Section 75 protection on bigger purchases you pay off straight away.
What happens to your credit score if you close a card?
Closing a card can make your score dip slightly, because your total available credit goes down (so your utilisation may go up) and, over time, your average account age may change. For most people, the effect is small and temporary, especially if you don’t carry balances on other cards.
Timing matters. If you’re applying for a mortgage soon, ask your broker before you close or open anything.
Keep an unused card active (if you keep it)
Some providers close cards that haven’t been used for a long time. If you want to keep one:
- Put one small regular payment on it, like a streaming subscription.
- Set a Direct Debit to pay the full balance every month.
- Check the statement each month for anything unexpected.
How to close a credit card properly
- Pay off the full balance, including any interest that appears on the final statement.
- Cancel recurring payments on the card and move them elsewhere.
- Ask the provider to close the account and confirm in writing.
- Cut up the card.
- Check your credit report in a month or two to make sure it shows as closed with a zero balance. Here’s how to check your credit score for free.
Credit limit increase: people also ask
Does a credit limit increase affect your credit score?
An increase you didn’t ask for usually doesn’t involve a hard search, and it can lower your credit utilisation if your balance stays the same, which may help your score. Asking for one yourself may involve a credit check, so ask first.
Can I refuse a credit limit increase?
Yes. Your provider should tell you how to say no before an automatic increase. You can also ask them to reduce your limit at any time, and opt out of automatic increases in future.
Is it bad to have a high credit limit?
Not if you pay in full and don’t spend more because of it. It can help your utilisation. But if it tempts you to overspend, or you’re applying for a mortgage, a lower limit may be better.
Does closing a credit card hurt your credit score?
It can cause a small, usually temporary dip, because your available credit goes down and your average account age may change. If the card tempts you or charges a fee, closing it can still be the right choice.
Should I close my oldest credit card?
Usually it’s worth keeping your oldest card if it’s free and you can use it responsibly, as it helps show a long credit history. If it tempts you to spend or has fees, closing it is fine.
How much of my credit limit should I use?
There’s no official rule, but using a small share of your limit, and paying it off in full each month, usually looks best to lenders. Keeping balances well below your limits is a sensible aim.
Summary
- A credit limit increase can help your score by lowering your utilisation, but only if you don’t spend more.
- Refuse it if you carry a balance, are struggling, or are applying for a mortgage soon.
- You can opt out of automatic increases and ask for a lower limit at any time.
- Close an unused card if it tempts you or charges a fee; remove an ex-partner’s additional card if needed. Keep it if it’s your oldest, free account and you trust yourself with it.
Next step: check your credit report to see your current limits and balances, then read how to improve your credit score.
General information only. I’m not a financial adviser. If you’re struggling with debt, please contact a free, confidential debt advice service such as MoneyHelper, StepChange or National Debtline.
Sources (checked 4 November 2026): Official source for corrected claim · Official source for corrected claim · FCA: new credit card rules · MoneyHelper: how to improve your credit score