Expired Credit Card? Here's What You Need to Know!
In this era, you will be hard-pressed to look for a consumer who does not have at least one credit card in their wallet. Credit cards can be a great financial tool if used wisely. However, one aspect of a credit card that people often seem bothered by is the expiration date and the numerous activities it can trigger. Below-mentioned is a guide on what happens when your credit card expires, and the measures you should take as a cardholder.
Reasons for Expiration Dates
A credit card has an expiration date for many reasons. These dates refer to the expiry of the card and not the card account. Some of the reasons for the existence of expiration dates are:
- They exist on your cards for the weathering. The chip on the credit card can become damaged and the plastic of the card can break. In most cases, after every few years, your credit card provider will send you a new card.
- They exist as a measure to prevent fraud. No matter where you use your card – in person, on the phone or over the internet, the expiration date provides extra data that can be cross-checked to make sure that the information on the card is valid and you are a genuine user.
- They give the card providers an opportunity for marketing.
- They give the issuer a chance to re-evaluate the terms of your credit card regularly as per your creditworthiness.
- The issuer gets an opportunity to send you a card with the updated designs or logos.
Time for a New Card
Several credit card providers notify you and provide you a new card well in advance of the expiration date on your current card. While the others will send you a letter or an email asking if you would like to renew.
Credit Card Terms
Before activating your new credit card, it is important to confirm that the terms and conditions are still the same for the new card. It is also advised to confirm the interest rate that is charged to you is the same, along with other details such as the payment due date, the fees, and the penalties. You should get all your facts cleared rather than anything coming as a shock to you later. It is also good to be updated on the recent credit card offers.
New Card Arrival
When your new card arrives, before using it you will have to activate it. Typically, the card comes with a sticker that indicates the website or a number that you can use for activation. Once you put in your new card in your wallet, you should make sure to cut up your old credit card and discard it. This is important because no one wants the old card’s information to land in the wrong hands. Once you start using your new credit card, be sure to update the automatic payments that you have on your card to reflect the new card details.
The Bottom Line
It can be a little baffling when you come across an expiration of your credit card. Generally, there is not a reason to be worried about it. A credit card provider does not want to lose business, which is the reason behind you hearing from them closer to the expiration date. This gives the company the opportunity to remind you of all the credit card offers in order to keep you as a loyal customer. It is important to do your research before signing on the papers, this will help you get the best card for your financial needs and spending pattern.