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You are standing at the cash register after a long day and the cashier tells you your credit card was declined. It can cause an array of emotions—frustration, fear and confusion.
Depending on your mindset, you may feel more or less equipped to take on the challenge. And while there can be a variety of reasons your card was declined, there are four simple steps to follow.
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1. Take a Deep Breath
There are a lot of dynamics that arise with a declined credit card. You or the cashier may feel added pressure depending on the length of the line behind you. Remind yourself that many of the people around you have probably had the same experience. Take a breath and consider your options.
While it is frustrating and inconvenient, in many cases, your card may be declined for your protection. This warning may be easily reconciled. If you have another means of payment, you may want to use it to complete your transaction. Let the cashier know if you plan to step out of line and try to resolve the issue immediately or if you will come back to complete the purchase later.
2. Review Your Card Info
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Double check that all of your information was entered correctly. Transposing numbers is an easy mistake to make. If you are using a card on file, double-check the card number and CVV security code against the actual card. Make sure you are using the zip code tied to your billing information.
If you received a replacement card or recently moved, you may need to update your card number or the billing information.
Check the Card Expiration Date
While this step may seem obvious, some credit card providers send renewal cards very close to the expiration date. Most people are not tuned into their upcoming card expiration dates, and it may have caught you by surprise. If your card is past the expiration date, it is no longer valid. At that moment, you will need to complete the purchase with a different method of payment.
When you get home, check your mail to determine if a new card was received. If not, contact customer service to ask that a new card be sent to you.
3. Contact Customer Service
Before your anxiety rises, contact the customer service phone number listed on the back of your card. There are a number of easily resolved reasons your card may have been declined.
If you recently activated your card and this is the first use, it is possible the activation process was not fully completed. The card provider may need to manually activate the card. Often, your card is declined for your protection to prevent fraudulent purchases. In this case, your card provider may just need to verify your identity and authenticate your purchase.
Regardless of the reason your card was declined, contacting your card provider can give you clarity on the issue so that you can make informed progress toward a resolution.
4. Work With the Card Provider To Resolve the Issue
Suspected Fraud
If you are making a large purchase, especially one outside your normal shopping behavior, the transaction may be flagged for potential fraud. You may also trigger a fraud warning if you are shopping out of the state or the country or if you’re using a card for the first time in a long while.
Your card provider may call or text you to ask for purchase approval. If your card issuer does not contact you, calling customer service may allow you to resolve the issue immediately by verifying your identity and intention to make the flagged purchase.
Over Your Credit Limit
Depending on your card, your purchase may be declined if you are already over your credit limit or if this transaction would put you over it. While some cards allow you to exceed your credit limit, other credit providers may decline the transaction.
If possible, you can make an early payment to reduce the balance and continue using that credit card. If the card has a low balance and you have strong credit, you can contact the provider and ask that they re-evaluate your credit limit. Note this may require that they pull your credit.
Even if you keep a relatively low balance on your card, you may be declined for being over the limit. If you recently stayed in a hotel or rented a car, that merchant may have placed a security hold on your credit card to cover the cost of possible damages. Due to this hold, you may not have sufficient available funds to complete the transaction at the time.
Behind on Payments
When life gets busy, it can be easy to overlook a payment. Or if finances are tight, you may be prioritizing certain bills. Whatever the reason, if you get behind on a credit card payment, that issuer may limit your purchasing power. They may do this by notifying you in writing, but it’s possible that the limit is lowered before you receive notice.
You will need to catch up on payments or set up a payment plan. Once you make consistent payments, your issuer may restore regular card use. If you find yourself behind on payments, contact your card issuer or reach out to a credit counselor for assistance.
Your Account Was Closed
Credit card companies can close accounts for a variety of reasons. If you have not used a card for a while and you do not carry a balance, the creditor may close your account due to inactivity. In this case, your creditor may be able to resolve the issue if your account is in good standing.
If your credit score has dramatically decreased since you opened your account, your card provider can close your account if you are now deemed a credit risk. Your card may also be declined if you were an authorized user on a credit card and the primary card holder has now removed your authorization.
No Other Payment Option
It happens. Sometimes you leave the house with only your ID and a credit card. If you find yourself in this situation, weigh your options. Can a friend cover you? Can you leave your purchase, run home and come back later? In many cases, a grocery store will hold your order, although you may need to put the ice cream back before it melts.
If these are not possible, speak calmly with the merchant about your options. Depending on the size of your purchase, the merchant may take your information or hold your ID and allow you to pay later. Make sure you are comfortable with the reputation of the establishment before leaving your ID.
Reducing Stress in the Future
There is no surefire way to avoid having your card declined. As long as there are computer glitches and credit fraud, you run the risk of being declined again. However, there are a few things you can do to reduce the chances of a declined card and to be prepared when it happens.
Set Up Credit Limit Notifications
Credit cards often allow you to tailor the notifications you receive. You can request a text or email update when you’ve reached a set percentage of your credit limit. This knowledge may also help your credit score. Experts recommend maintaining a balance of less than 30% of your credit limit. While this is not always possible, it is good to stay informed.
Update Your Contact Information
Make sure your cell phone is the primary number on the account. This allows you to verify your identification more easily when you call from the number on file. If you are traveling internationally, ensure that your cell phone has an international voice and data plan.
Carry Back-up Payment Methods
Keep multiple payment methods on hand. It may be wise to carry a debit card as well as a secondary credit card. Also consider setting up a mobile payment app like Apple Pay or Google Pay. More and more merchants will accept payment from your cell phone, so even if you leave your wallet at home you can complete a transaction.
Set Up Travel Alerts
Update your card provider with your travel destination and dates. Make sure to give them contact information where you can be reached. You may also want to set up a PIN number before traveling. In some countries, unmanned terminals like those at gas stations often require a PIN. In these cases, if you do not have one, your card will not be accepted.
Stay on Top of Your Payments
If you tend to have a lot going on, setting up automatic payments can ensure you do not get behind. If you know you are unable to make a timely payment, contact your card provider before your payment due date to discuss your options.
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Bottom Line
A declined credit card is not the end of the world. If possible, pay for the purchase with another method and give yourself space to resolve the issue. There is no need to worry right away—reach out to customer service to get more information. Don’t worry about what the merchant is thinking, cards get declined for a lot of reasons and it happens more frequently than you may think.
