Banks are quietly increasing credit limits by over $40 billion per quarter, often without customer consent, according to research from King’s Business School and the Federal Reserve Board.

AI is being used by banks to target vulnerable customers with credit limit increases, leading to a rise in credit card debt in the U.S.

American credit card debt reached a record $1.23 trillion in the third quarter of 2025, with 46% of cardholders carrying debt and feeling trapped.

Higher credit limits can lead to a cycle of minimum payments, rising debt, and reduced savings, fueling lifestyle creep and long-term interest revenue for banks.

To address the issue, researchers suggest implementing regulatory frameworks like those in Canada and the UK to prevent unauthorized credit limit increases in the U.S.

Consumers can take control by disabling automatic credit limit increases, paying attention to marketing tactics, and using budgeting tools to manage spending and debt effectively.

Read more at Yahoo Finance: Your bank may be quietly pushing you deeper into debt and many credit card users don’t realize it’s happening