What is a floor limit and a card limit?
A card limit is the amount you can spend on your card account and is given by the lender. It appears on your statement and once you go over this limit you are heavily penalised with charges. A floor limit is an amount given to the retailer by the bank, say £100, whereby the retailer does not have to seek prior approval for the transaction to be approved. For example if you bought an item for £99 from a shop and that shops floor limit given to them by your bank was £100 then that transaction would be approved regardless of whether you have sufficient credit available on your card or account with your bank. The floor limit in most instances would be fairly small and in some instances if the cardholder has a past record of going over their limit or over drawing their account then the bank can put in place steps to ensure all your transactions are checked for sufficient funds.
