There are two different kinds of spending limits, though the rules are the same for both
- Account level spending limits applied to all purchases on someone's account
- Card spending limits applied to just the purchases made with that card
Spend limits are applied to accounts on a rolling basis
- Purchases count against a user's spending limits for an allotted time period and "roll off" when that time expires.
- Daily: 24 hours
- Weekly: 7 days (with 18 hour buffer)
- Monthly: 30 days (with 3 day buffer)
- For example: a user has a $100 daily limit and spends $20 at 7am on Day 1. The user's spend limit is now $80. If they don't buy anything else, their daily limit will revert to $100 at 7am on Day 2.
Buffer periods are also built into certain limits in order to prevent unnecessary declines in case a merchant charges someone early.
- User has a Netflix card with a $15 monthly spending limit.
- Netflix charges them $13 at 7AM on May 25.
- If Netflix charges this User again for $13 on June 21 it will decline, because it exceeds the card's monthly spending limit and it is not within the 3-day buffer period.
- If Netflix charges this User for $13 on or after 7AM on June 22, it will be approved because it is within the 30 days minus 3-day buffer time period.