You’ve been a good credit card customer, faithfully paying off your bill every month. And you’re careful to use very little of your available credit.

But then your lender sends a letter informing you that your credit limit has been significantly reduced.

This happened recently to a reader in Pelham, N.H. Her credit card company said it was cutting her credit limit almost in half, to $7,700. The reason: “We saw that you spend far below your available credit limit,” the issuer wrote to the cardholder.

Many consumers are getting similar notices as lenders seek to reduce their credit portfolio risk as a result of the economic fallout from the coronavirus pandemic. And it’s not without reason.

After going through their savings, many people suffering a job loss or reduced income turn to their credit cards to make ends meet. At some point, keeping up even with minimum monthly payments proves too much, and they end up falling behind. This can also happen to people who have previously paid their bills in full, resulting in losses for lenders.

So, during economic downturns, credit issuers often cut credit limits or even cancel cards with no or little warning. This can be true even for consumers with excellent credit scores. Under the FICO credit scoring model, scores range from 300 to 850. The higher your score, the better. Subprime borrowers, whose credit scores range roughly from 580 to the low 600s, are considered to be at a higher risk of defaulting on their debts.

In October 2008, during the Great Recession, a Federal Reserve loan survey on bank lending practices found that 20 percent of lenders cut credit lines for customers with prime credit scores, and 60 percent reduced lines for subprime cardholders.

“Banks are once again very nervous about the state of the economy and the job market, and they’re pulling back on their risk exposure,” said Ted Rossman, an industry analyst at

FICO, the company behind the most-used credit score, recently launched a new product to help lenders figure out which consumers are likely to be financially resilient during an economic crisis. FICO’s “Resilience Index” allows financial institutions to continue lending to consumers who might otherwise be cut off from credit or be offered higher-interest loans.

The index has been 10 years in the making, according to Jim Wehmann, executive vice president of FICO Scores.

“We now can predict which consumers are best positioned to withstand a downturn and which ones are not so well positioned,” Wehmann said in an interview. “The FICO Resilience Index can allow lenders to keep credit flowing to even low FICO scorers and below-average FICO scorers who we can identify for the very first time that they are resilient.”

The resilience index score ranges from 1 to 99. In contrast to FICO’s credit scoring model, a low score on this index is better. Consumers with scores in the 1 to 44 range are viewed as the most prepared to weather an economic shift, Wehmann said.

Consumers with an exceptional resilience index tend to have longer credit histories, fewer active accounts and less-frequent credit inquiries. High-scoring consumers also have lower revolving credit card balances.

Credit scoring models examine your credit utilization for each active account and, separately, your usage of all of your credit cards together. Thirty percent of your credit score is made up of your credit utilization, meaning what percentage of your available credit is being used. One study by FICO found that cardholders with scores above 795 use, on average, 7 percent of their credit limit.

Although this product is intended for use by lenders, insight into how it works can help consumers improve their credit scores, Rossman said.

For example, let’s say two consumers each have a FICO score of 680. That’s a good-but-not-excellent score. Rather than treat both of these consumers the same, the resilience index would dig a little deeper into their credit profiles looking for certain patterns, such as credit utilization.

So, one consumer may have a high credit utilization of 70 percent. But the second consumer only uses about 10 percent of his or her available credit limit, resulting in a much better resilience index score. Somebody who’s maxing out a card is less likely to be resilient in a downturn.

This new tool could be most useful for people on the verge of being denied credit or having their credit limit reduced, Rossman said.

“It’s not a replacement for the traditional credit score,” he said. “It’s something that’s going to be used really as more of a tiebreaker. When the economy takes a turn for the worse, when unemployment goes up, the knee-jerk reaction from lenders is just to clamp down on credit. Instead of that kind of slash-and-burn approach, they can be more surgical so they can actually separate people out a little bit better.”