Card Declined: Why Has My Card Been Declined?

Having your credit card declined when you try to pay for something can be embarrassing, but it doesn’t necessarily mean you have a major problem.

Read on to find out the common reasons for declined credit cards.

Why has my credit card been declined?

There are several common reasons your credit card may be rejected. These include:

• You’re abroad: If you are going on holiday, it is a good idea to let your credit card provider know. If you don’t, it may suspect that your card is being used fraudulently and your transactions may be declined.
• You’ve changed your spending habits: You may be using your card, but your credit card company doesn't know that. Sometimes unusual spending activity, such as a lot of purchases in a short space of time or a rare big purchase, can trigger anti-fraud protection and mean your card is declined.
• You got your numbers wrong: Double check that you entered your credit card details or PIN correctly.
• You’ve reached your credit limit: There is a cap on how much you can spend on your credit card. If you reach your limit, your credit card will be declined.
• You’re behind with your repayments: Your credit card company may place a block on your credit card if you have missed too many repayments.
• Your card has expired: You may simply be using an old card that you need to replace with your provider.
• Your credit card has been cancelled: If you are an additional cardholder on someone else’s credit card account, they may have triggered a freeze on all cards. This sometimes happens if they report their own card as lost or stolen.
• The merchant does not accept your card: Some merchants do not accept credit cards, and some do not accept certain types of credit card, so you may simply need to use a different payment method.

What does it mean if I max out my credit card?

One of the most common reasons your card may be declined is that you have maxed out your credit. This means the balance you owe on your account has reached your credit card limit.

When you are approved for a credit card, your provider will give you a credit limit. This is how much you can borrow on the card. If you reach this amount, you won’t be able to use the card until you have repaid some, or all, of your debt.

» MORE: How to read your credit card statements

What happens if you max out your credit card?

If the balance on your credit card reaches your agreed credit limit, then your credit card is likely to be declined when you try to use it.

Sometimes a transaction that will take you over your credit limit is able to go ahead. This could be because several transactions go through on the same day or over a weekend. If this happens, you are likely to be charged a fee for exceeding your credit limit. It can also affect your credit score.

If you repeatedly exceed your credit limit, your credit card provider may remove any promotional deals on your card and, in extreme cases, close your account and request that you repay what you owe in full.

» MORE: How to pay off your credit card balance

Can I cancel a maxed out credit card?

If you have maxed out your credit card you won’t be able to close your account as long as there is a balance left to pay. The account will remain open and appear on your credit report as an active account until you have paid off everything you owe.

However, you could ask your provider to freeze the card while you repay your debt, meaning you can’t be tempted to keep using it.

» MORE: Freezing your credit card: what you need to know

Does my credit card being declined affect my credit score?

Your credit card being declined won’t have any impact on your credit score. However, the underlying reason for your card being declined could.

If your credit card has been declined because you have exceeded your credit limit, this will likely have an effect on your credit score. This is because it will impact your credit utilisation rate – that’s how much of the total credit available to you that you are using.

If you repeatedly exceed your credit limit it could affect your credit rating, as it suggests you are having financial problems.

Equally, if your credit card has been declined because you have fallen behind with your repayments, then your credit score is likely to be affected. This isn’t because your card was declined, but because your credit card provider will be reporting your late or missed repayments to the credit agencies. This will appear on your credit report and drag down your score.

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