Spending over your credit limit

Information verified correct on October 1st, 2016

Hang swiping credit card

What happens when you spend over your credit limit?

Do you often spend over your credit limit? If the answer is yes then you’re probably familiar with credit card overlimit fees.

It’s when you spend over your credit limit, even by as much as a dollar or two, either through a purchase or ATM withdrawal, and get charged a fee for doing so.

You may even be charged an over limit fee if you exceed your credit limit from something like a cash advance fee that has been charged to your account. If a transaction like a cash advance charge takes you over your credit limit, you usually have a day to pay the balance down before the overlimit fee applies, so it can depend on how quickly you can pay down the overdrawn balance. And with some overlimit fees being as high as forty dollars, over limit fees on credit cards can be a real source of pain.

Most providers will still allow cardholders who opened an account before the 1st of July 2012 to go over their credit limit. And charge a fee in the process. If you prefer the flexibility of being able to exceed your credit limit, most providers allow you to do so by signing a consent form and agreeing to a charge of $10-$20.

So as you can see it’s not difficult to incur this charged, and with some providers this fee can be greater than the annual fee on their low rate credit card products. So it pays to keep an eye on your account balance at all times if you’re the type of cardholder who regularly spends up to their credit limit.

Which lenders let you spend over your credit limit and charge you for it?

ProviderNotes
Bankwest
  • Applies to all credit card accounts.
  • If debits to your credit card take you over your credit limit then an Over Limit Fee will be charged in each statement period,
  • You can opt for it not to go over the limit – contact the lender to do this.
Citibank
  • No overlimit charge applies to credit card accounts opened before the 1st of July 2012.
  • Charged once per statement period.
Commonwealth Bank
  • All credit card accounts – you won’t be able to spend over your credit limit.
  • Overlimit fees and charges will apply if bank fees (i.e. cash advance charges / interest charges) or direct debits take you over your credit limit.
ANZ
  • Overlimit charges apply to all ANZ credit card accounts.
  • In some cases ANZ may allow you to spend over your credit limit (direct debits, cash advance charges, paypass facility (doesn’t check the available funds on the card) and interest charges will all allow you to exceed your credit limit and incur an overlimit charge.
Westpac
  • Whether or not you can spend over your credit limit depends on a number of factors – like your history of repayments on your account.
  • However, if your account was opened before the 4th of June 2012, you may be able to exceed your credit limit.
  • You can contact Westpac and opt out of being able to exceed your credit limit.
St.George
  • No overlimit charge applies to credit card accounts opened before the 4th of June 2012.
Bank of Melbourne
  • No overlimit charge applies to credit card accounts opened before the 4th of June 2012.
  • Purchases and credit card fees and charges can take you over your credit limit.
BankSA
  • No overlimit charge applies to credit card accounts opened before the 4th of June 2012.
Coles
  • If you’re making a purchase and you go ten or fifteen dollars over your limit, you may be allowed to exceed your credit limit.
CUA
  • No overlimit charge applies to credit card accounts opened before the 1st of July 2012.
  • Charged once per statement period.
Latitude Financial Services
  • Applies to all credit card accounts.
  • You can not spend over your credit limit, interest charges may take you over limit; however, no fee will be charged for doing so.
HSBC
  • All credit card accounts can spend over their credit limit – up to a percentage of the cardholders approved credit limit.
American Express
  • All credit card accounts are allowed to spend over limit.
  • The amount that can over limit is judged on a case by case basis factoring in things like the size of the credit limit, previous spending habits and repayment history.
NAB
  • Applies to all credit card accounts.
  • Some transactions will take you over your credit limit.
  • NAB will contact you once per statement period and inform you that you’ve reached your credit limit.
Virgin Money
  • No overlimit charge applies to credit card accounts opened before the 1st of July 2012.
  • Charged once per statement period.

Back to top

How to avoid going over your credit limit

Set up internet or telephone banking 

The simple answer is to keep an eye on your credit card balance. There’s a couple of ways you can easily do this – set up internet or telephone banking. If you have a smartphone, which most of us do, this means your account balance is just a click away. It’s also required by law for the lender to notify you when you’re about to exceed your credit limit. If you have internet and telephone banking set up, the card provider can send you an SMS notification when you’re about to exceed your credit limit.

Impose a hard limit on your credit card account 

If you have a provider that allows you to spend over your credit limit, and you’re sick of incurring credit card overlimit fees, the simplest solution is to give your lender a call and let them know that you want to impose a ‘hard limit’ on your credit card account. This means that once you reach your credit limit, any transaction that would have taken you over limit will be declined.

Comparison of credit cards that allow you to spend over your limit

Rates last updated October 1st, 2016
Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Enjoy a 0% p.a. balance transfer offer for 18 months and also earn 2 bonus Velocity Points in the first 3 months on everyday spend.
20.74% p.a. 0% p.a. for 18 months $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
ANZ Low Rate
Save with a low rate on purchases and balance transfers with a low annual fee and ongoing purchase rate.
13.49% p.a. 0% p.a. for 18 months with 3% balance transfer fee $58 p.a. Go to site More info
Westpac Low Rate Card
A no frills credit card with an introductory rate of 0% p.a. for 18 months on balance transfers and 1% p.a. for 12 months on purchases.
1% p.a. for 12 months (reverts to 13.49% p.a.) 0% p.a. for 18 months $59 p.a. Go to site More info
Back to top
Was this content helpful to you? No  Yes

Related Posts

Ask a Question

You are about to post a question on finder.com.au

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Disclaimer: At finder.com.au we provide factual information and general advice. Before you make any decision about a product read the Product Disclosure Statement and consider your own circumstances to decide whether it is appropriate for you.
Rates and fees mentioned in comments are correct at the time of publication.
By submitting this question you agree to the finder.com.au privacy policy, receive follow up emails related to finder.com.au and to create a user account where further replies to your questions will be sent.

Credit Cards Comparison

Rates last updated October 1st, 2016
Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Enjoy a 0% p.a. balance transfer offer for 18 months and also earn 2 bonus Velocity Points in the first 3 months on everyday spend.
20.74% p.a. 0% p.a. for 18 months $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
ME Bank frank Credit Card
Enjoy a low and consistent interest rate on purchases and cash advances, combined with no annual fee.
11.99% p.a. $0 p.a. Go to site More info
St.George Vertigo Visa
Introductory offer of 0% p.a. for 18 months on balance transfers and 1% p.a. for 12 months on purchases, plus a low annual fee.
1% p.a. for 12 months (reverts to 13.24% p.a.) 0% p.a. for 18 months $55 p.a. Go to site More info
HSBC Platinum Credit Card
Receive a full annual fee refund and save $149 if you meet the $6,000 spend requirement. Enjoy a balance transfer offer and platinum card benefits such as complimentary insurances and concierge services.
19.99% p.a. 0% p.a. for 15 months $149 p.a. Go to site More info

* The credit card offers compared on this page are chosen from a range of credit cards CreditCardFinder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.

Ask a question
feedback