Photograph: Mike Mozart/Creative Commons
If you ever face a situation where your card transaction is declined, it is advisable to call your bank and check with them for the cause.
In most cases, unless it's a fraudulent issue, the problems will be resolved on the phone, says Abhishek Agarwal
There are many reasons why a credit card swipe can be declined. We have listed the top eight reasons for such refusals:
1. Credit limit
Oh yes! This is the most common reason and all credit card users sure know this one. We have a fixed credit card limit (the maximum amount you can spend on your card preset by the issuer during the issuance), which if we cross or are very close to crossing could cause decline of payment.
Keep a track of your spending and keep in mind your credit limit to prevent such a situation.
2. Invalid card
If you are using an add-on card that gets declined, it is possible that the primary cardholder has either reached the maximum account limit or has closed the account.
3. Change in terms and conditions
Do you have multiple credit cards from the same bank? If you default payment on one of those cards, it is possible that the bank has blocked the other cards.
In such an instance your swipe will be declined.
Even if you have multiple cards from different lenders, banks randomly pull your CIBIL credit score to take a relook at the creditworthiness. If the bank feels it has to lower your limit, it will give you a notice and do so.
4. Unknown location
If you live in India and there is a credit card swipe in, let's say, Russia. This transaction will be declined, because historically, all your swipes have been in India, and the lender might assume it is fraudulent transaction.
So if you are travelling abroad, it is a wise step to call your credit card company and inform them about your scheduled trip.
5. Unusual currency
If you have always bought in rupees and suddenly if you use your card to buy a ticket online in dollars that too with a big amount, this transaction is bound to be declined.
Call your credit card company and give them a heads up before making such a purchase.
6. Technological reasons
These days, most of the new credit cards that are being issued come with an inbuilt chip. Now, to clear such a transaction, you need to key in a PIN number.
Sometimes the merchant may be using a point of sales (PoS) machine that is outdated or if you have forgotten your PIN number or if your credit card is new and if you have not yet registered your PIN number, the transaction could be declined.
7. Wrong data
If you have entered a wrong billing address while buying a product online, or if you have entered a wrong credit verification value (CVV) or a wrong code for 3D secure password, the transaction will be declined.
So, if you ever face a situation where your card transaction is declined, it is advisable to call your bank and check with them for the cause.
In most cases, unless it's a fraudulent issue, the problems will be resolved on the phone.
Also, make sure you do not swipe the card again if it is declined. After three continuous declines, the bank may block it suspecting fraud.
Keep your phone number updated with your credit card issuing bank, as the bank will alert you every time there is a swipe.
Lastly, save the customer care number of your bank on your phone so that, when you are in hurry to call them, you don't run from pillar to post.
The author is Co-founder and Director Credit Vidya.