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Fortune
Fortune
Mia Taylor

How your credit card companies decide your spending limit

Photo illustration of a close up of a man's hands holding a credit card and using a laptop. (Credit: Photo illustration by Fortune; Original photo by Getty Images)

When opening a new credit card, the issuer automatically sets a credit limit—which is your spending threshold for the card. It can often be mystifying as a consumer trying to understand how that limit is established.

The reality is that various factors contribute to the decisions made by credit card issuers. Key among the considerations are your credit score, payment history, income, and debt-to-income ratio (DTI).  

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