Possessing a credit card has become a necessity instead of a luxury in modern times. They offer you the option of making a purchase and paying later. Moreover, you also earn reward points and cashback on various transactions. As a result, having multiple credit cards has become quite common.
Many credit card users like to have multiple cards to maximize the benefits of their purchases, online and offline. If you also have several credit cards but have not been using them for over a year, closing unused credit card accounts is ideal. You need to know which credit card account you must close and how. Read on to know all about closing a credit card.
Closing a Credit Card: Important Points
Do you have a credit card or multiple credit cards you do not use? Are you thinking of closing your credit card(s)? Then there are some points you must consider before moving ahead: –
- Choose the credit cards with maximum annual fees and interest charges
- Compare the benefits of closing the credit card or opting for a balance transfer
- Do not close a credit card with a long credit history, as this can affect your credit score
- Follow the procedure stated by the credit card issuer properly as the procedure for ‘how to close SBI credit card’ would differ from ‘how to close RBL credit card’
Closing a Credit Card: Steps to Follow
Are you looking for steps to close a credit card? Here are some common steps you must follow to close a credit card: –
Settle The Dues
Your credit card issuer needs you to clear all the dues before closing the account. So, make sure you pay all the dues against your credit card before applying for closure. If you cannot clear all the dues, transfer them to the credit card, and you will continue to use them. Moreover, ensure you use all your reward points before closing a credit card, as reward points will be forfeited on closing a credit card account. After completing this step, you need to contact the customer care team for credit card closure.
Contact the Customer Care
You must contact the customer care team to close the credit card. You can get in touch with them through a phone call, email, mobile app, or through post. You should use the phone call option as it will deliver quicker results. During the call, the customer care team will ask you the reason behind this step. You are at liberty to state the reason you want, and they might also offer you some benefits for not closing the card.
If you still decide to close the credit card, they will ask you to pay any outstanding amount first. Thereafter, they will process the request and share a reference number with you. Note down this reference number carefully. During this process, keep your credit card details handy for verification purposes. The customer care team will also tell you the expected time frame for this process.
Get a confirmation
To avoid any issues later on, insist on a confirmation message or email. You will most likely receive an SMS on your registered number with the reference number for the account closure request. But it is advisable to ask for confirmation by email. You can write an email to the customer care team from your official mail id.
Include all details related to the call for cancellation and your reference number. You shall receive a reply from the credit card issuer in a few days detailing the status update for the account closing request. Take a printout of this mail for reference and save it as ‘important’ in your correspondence.
The credit card issuer will contact you if there are some issues. You must provide clarification or submit the documents immediately. This is important to speed up the procedure for closing the credit card account quickly.
Ask for an NOC
After you have paid the dues and applied to close the credit card account, ask the bank for an NOC or NDC. The credit card issuer will issue a ‘No Objection Certificate’ or a ‘No Dues Certificate’.
Check this document carefully and ensure every detail is included correctly. This certificate is essential in case of any issues in the future. You must store this document very carefully. It is advisable to take a printout and put it in a file. Also, save the PDF on your phone or computer for ready reference in the future.
Check your credit report
After a few months, make sure that you check your credit report for this credit card account closure. You must check if the credit card issuer has updated the credit card status as closed. You need to ensure that it is mentioned in the credit report that the credit card has been closed on your request and no dues are outstanding.
If not, it will seem that the bank has closed the credit card, and it will reflect poorly on your credit history. If there are any issues, use the NOC or NDC to correct the error as soon as possible. As soon as the credit card is closed, it will likely impact your credit score positively.
Closing a credit card properly is extremely important for your credit score. Any discrepancy at your end can severely affect your credit rating in the future. Hence, do not go for any shortcuts to complete this process. Follow the specified process completely to avoid any hassles in the future. In case of any doubt, consult a financial expert like Piramal Finance and get easy and customised personal loan solutions.