How to Close or Cancel Credit Card?

• The most common reasons to close a credit card include non-usage, security measures, changes in lifestyle habits, etc.
• Evaluate the pros and cons before you make the final decision.
• Clear your dues and also ensure there are no standing instructions on the credit card you want to close.
• The Reserve Bank of India has directed the card issuers to honour the card closure request within seven working days. However, you must ensure there are no outstanding dues.

A credit card offers several benefits and can be used as a valuable tool to manage expenses better. From reward points to additional offers to airport lounge access, it can help you upgrade your lifestyle and make spending more rewarding.While you can have multiple credit cards, it may happen that you want to close a credit card for some reason. This blog will explain the process of closing a credit card.

You may opt to close the credit card you have for any of the following reasons:

• Non-usage: If you don’t use your card, you may want to consider closing it, especially if it involves annual fees.
• Security: You can consider closing your card in case of any fraudulent activities. This way, you can protect your financial information.
• Easy Management: Keeping track of multiple card usage can get challenging at times. Thus, keep the cards that you need to streamline your finances.
• Lifestyle Habits: Changes in lifestyle and spending preferences are also common reasons to close the credit card.
• Better Features: You may want to close your existing card to shift to another card that offers comparatively more features and better deals.

Before you decide to close your credit card, here are a few things that you should consider:

• Outstanding Dues: Clear the outstanding dues and settle all pending payments to avoid a levy of interest and other charges.
• Standing Instructions: Ensure there are no standing instructions on your card. Cancel all auto-payments linked to your card.
• Holding Period: The older the card, the higher its contribution to your credit score . Thus, consider closing the newer ones first.
• Reward Points: Redeem the accumulated points and avail of the eligible benefits as per the terms and conditions.
• Credit Score: Understand the impact of credit card closure on your credit score before you decide to close it.

Proceed with the card closure formalities after evaluating the pros and cons of your card closure. You can either use the online method or the offline method based on your convenience.The closure process is more or less the same. It varies in terms of the steps to be followed and/or the details required.Let’s take a look at both the online and offline processes for credit card closure.

The online closure process typically involves these steps:

• Step 1: Login to your account on the official website of the card issuer.
• Step 2: Navigate to the ‘Cards’ tab and select the ‘Credit Card’ option.
• Step 3: Select the option indicating card closure.
• Step 4: Choose the card you want to close and mention the reason when asked for.

Note: You can also close the credit card through your mobile application.

If you are not comfortable with the online process, you can close your card offline through these steps:

• Step 1: Visit the nearest branch office of the card issuer.
• Step 2: Ask for the credit card closure form.
• Step 3: Fill out the form and submit the relevant details.

Note: You can also close the credit card via customer care.

The Reserve Bank of India has directed card issuers to honour the card closure request within seven working days. In case of outstanding dues, the card issuer will share with you the details of the outstanding upon the receipt of the closure request. These details are provided without waiting for the completion of the billing cycle.You will have to clear the dues in order to complete the closure. You must note that the timeline of seven working days is calculated after excluding the number of days you take to clear the outstanding dues.

Be Sure Before You Close the Credit Card

Evaluate the impact of credit card closure on your credit score and note that you will no longer be able to access its rewards and offers. Also, be mindful of the fact that once you close your card, your total credit limit will be affected.After weighing the pros and cons, if you finally decide to close the credit card, remember to clear all outstanding dues to complete the closure process seamlessly. Also Read: Credit Card Guide: What Are They and 3 Different Types of Credit Cards