Limit - what is it and how is it calculated

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Limit - what is it? And how often do you come across this concept? In various literature, this word has one designation - limit. This term is popular in the financial, scientific and gambling fields. However, today this word is most often used in banks. What the limit implies and who sets it, we will consider below.

Bank limit

As already mentioned, in all areas the word "limit" has one designation - the limit. For banking operations, this term is used when setting any restrictions on monetary transactions. Sometimes the inability to withdraw a certain amount of money leads to great difficulties and deterioration of the bank's reputation. Each lender has the right to set its own withdrawal limits no higher than the law.

Limit - what is it and why should a bank set it? The answer to this question lies on the surface. Establishing a limit on the withdrawal of certain amounts serves to protect funds and prevent fraud. So, today there are restrictions on cash desks, ATMs, card and credit accounts.

The maximum withdrawal amount is equal to the number offunds that the client is able to return. When working with accounts, the cash limit serves to ensure cashless transactions.

Credit limit

Often in the terminology of bankers you can hear unfamiliar concepts. Limit - what it is and how it affects the withdrawal of credit funds of the client, must be explained when receiving a credit card. A similar restriction is imposed on the amount that, based on the income of the borrower, can be issued to him.

The credit limit is set on an individual basis and may depend on many factors. These factors include: the income of the borrower, the term of the contract, the credit policy of the bank and other factors. After some time, the bank may offer to increase the maximum amount for use. In this case, the limit is calculated based on how and in what amounts the borrower repaid the debt.

Card limit

Limit - what is it and how it is displayed on the map, it is worth understanding in more detail. There are several types of such restrictions:

• Restriction on ATM withdrawals.
• Daily cash withdrawal limit.
• Restriction on internet transactions.
• Restriction on the issuance of funds at the box office.

So, the established limit on the issuance and settlement of funds from the account is a card limit. Such requirements are associated with the order of the Central Bank. So, today the maximum amount of cash withdrawal in ATMs for Visa Electron andMasterCard is equal to 100-150 thousand rubles, for standard cards - 300 thousand rubles, for cards of the "Gold" series - 500 thousand rubles.

Maximum and minimum thresholds are set by the Central Bank, but banks have the right to set their own limits if they do not exceed the law. For example, the withdrawal limit at the institution where the client is served can be one, and for a third-party ATM it is much less.

In order to withdraw an amount above the established limit, the client must contact the bank's hotline or directly to the office. Bank employees, at their discretion, can decide in favor of the client and vice versa.