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Closing credit cards with zero balance

When and How to Cancel Your Credit Card Safely?

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When and How to Cancel Your Credit Card Safely?

A credit card can help you borrow funds for your purchases. Besides, you can also avail yourself of facilities such as balance transfer and cash withdrawal. What’s more, you receive various rewards and offers, including gift vouchers, money back, discounts, free access to lounges, and more. If you use the credit card in the right manner - by paying your dues in time and by maintaining the right balance between the usage and credit card limit - it can help you have a good CIBIL score. But there can arise a scenario where you need to close your credit card. If you are grappling with the question: when can I cancel my credit card? Here’s a look at the reasons, along with the steps required to cancel your credit card safely.

Reasons to Close your Credit Card

Although some experts advise against closing your credit card, it can still be the best decision in certain situations. Wondering when to close a credit card? Here’s a look:

  • When you have a joint account:

If you had previously secured a joint credit card with your partner, friend or relative, but now have an estranged relationship, what should be the step forward? Should you close a credit card with zero balance in this scenario? Well, yes. You must foremost clear the dues, ensure that there is zero outstanding balance and proceed to close your card. This is because, as a joint account holder, you too are responsible for all future expenses. Sharing a financial relationship with an individual with whom you are not on congenial terms is certainly not advisable.

  • Excessive fees and charges:

Closing cards with zero balance is also advisable when the card-issuing bank has high fees and changes. For instance, if the credit card has a high annual fee without corresponding benefits, you can benefit by cancelling it. Similarly, if your credit card carries a high-interest rate or a plethora of associated charges, you can choose to cancel it.

  • When you lack self-control:

The inability to control your purchases with a credit card can spell disaster for your finances. If you find yourself asking, is it better to close a credit card or leave it open with a zero balance? Here’s the answer. If you can’t stick to your monthly budget and repeatedly splurge on redundant expenses, you can select to cancel your credit card. This is because overspending and not paying your credit card dues in time can negatively affect your CIBIL score. If you choose to leave the credit card open, you might be tempted to use it again. Besides, you still have to pay annual fees along with some other charges on an open card.

How to Safely Close a Credit Card?

Now that you have an answer to the question, when should I close my credit card? Here’s a list of factors to consider before making the final move:

  • Ensure zero balance: Before closing your credit card, make sure that there are no dues. You must clear the outstanding amount before making a cancellation request.

  • Read the fine print: Before raising a cancellation request, make sure that you have read the terms and conditions of cancellation. This is because some issuers can levy cancellation fees or other associated charges.

  • Use the reward points: While using the credit card, you might have earned credit card reward points. Make sure to redeem them.

  • Know the exact date: While getting your credit card cancelled, you must know the exact date of cancellation. This will help you plan your future purchases with alternative methods of payment.

  • Get written approval: To cancel your credit card safely, you must get written consent from the issuing bank. Typically, the issuer will send you a confirmation as an email. If you are wrongly billed or want to raise a dispute for your CIBIL score, this written confirmation will be handy.

  • Close automated payments: Before cancellation, make sure that all automated payments through your credit are closed.

Process of Closing your Credit Card

Once you are aware of: how to safely close a credit card? you can raise a cancellation request by choosing any of the four methods mentioned below:

1. Submit an online credit card cancellation request:

If you prefer to raise an online request, you must:

  • Visit the issuing bank’s official website.

  • Select the option to cancel your credit card from the menu/sub-menu.

  • You will be asked to fill an online form.

  • Fill in the requisite details and submit any documents, if required.

  • Confirm cancellation after submitting the form.

  • You will shortly receive a response from the bank through a phone call, email, SMS etc.

2. Offline cancellation via post:

You can also send an offline cancellation request through ordinary/registered post or courier. Here you are required to:

  • Write a letter stating the reason for credit card cancellation.

  • Mention all the relevant details, such as your credit card number, bank details, and so on.

  • Send the letter to the issuing bank’s official address through ordinary/registered post or courier.

3. Credit card cancellation through email:

Many issuing banks have a designated email address for closing your credit card. In the absence of a separate facility, you can send an email to the issuer’s official address. If you prefer this method, you are required to:

  • Write an email with your credit card details.

  • Once you send the mail, the issuing bank will contact you within a few days.

4. Credit card cancellation through customer care:

Did you know that you can even cancel your existing credit card simply over a phone call? Yes, you can reach out to the customer care of the issuing bank and select the option to close your card. You are just required to:

  • Contact the toll-free credit card customer care number.

  • Follow the IVR options to cancel your credit card or speak to a customer care executive.

  • Provide the relevant details to authenticate cancellation.

  • The issuing bank will shortly contact you to confirm the cancellation/closure.

If you want to know the toll-free numbers of the major credit card issuing banks in the country, refer to the table below:

Issuing bank

Customer care number for raising a cancellation request

SBI Credit Card

1800-180-1290

Axis Bank Credit Card

1800-209-5577

RBL Bank Credit Card

1800-121-9050

Citibank Credit Card

1860-210-2484

The Bottomline

Though it is not advisable to close your credit card, it can still be a sound decision in certain situations. Along with knowing when to close a credit card, you must have a checklist in place. This will help you to close the credit card safely, without any negative impact on your CIBIL score. The actual process of cancellation can vary between different issuing banks, and you have multiple options to raise a cancellation request.