Why your credit card application was declined, and how to fix it
Your credit score is too low, you don't earn enough, you spend too much — these are all reasons your credit card application might be declined.
Key takeaways
- 9% of Australians have had a credit card application declined, according to Finder research.
- Most of the time a credit card application gets declined because you didn't meet a minimum income requirement, your credit score is too low or you spend too much.
- It's wise to avoid applying for a new credit card right after an application is declined. Wait until you are in a better position to get approved.
8 reasons why your credit card application may be declined
- You have irregular income. Full-time, or stable part-time employment will increase your chances of getting a card application across the line.
- Your income is too low. Some credit cards list a specific minimum income requirement that you must meet. And even if this isn't listed, card providers are obliged to lend responsibly. This means they can't give you a card if you can't afford repay it.
- Your spending is too high. Even if you do meet the minimum income criteria, you'll get knocked back if you spend too much of your income each month.
- Your credit score is too low. Most Australian credit cards need you to have a credit score that is Good or Excellent. Check your credit score for free and see if you have any late or missed payments on debts and bills to sort out.
- You put incorrect information in your application. Credit card issuers need to verify all of your details before they move forward with the application. Something as simple as a misspelt address or wrong digit in your licence could cause a problem.
- You're under 18. You have to be 18 or older to get a credit card in Australia.
- Your circumstances have changed recently. If you have recently moved or changed jobs and haven't updated this information across all your networks, it could be hard for the issuer to verify your identity or access your credit report.
- You don't meet the citizenship or residency requirements. While there are some credit cards available for temporary residents who hold a specific visa, other cards are only available for permanent residents and citizens of Australia.
How to improve your chances of credit card approval next time
If your credit card application has been declined, don't rush out and apply for another one right away. Look at the list above and try to figure out what went wrong.
Applying for several credit cards in a short period of time leads to multiple enquiries on your credit report and can be a red flag.
- Get a copy of your credit report. This allows you to make sure all the details listed are accurate. It can also give you a better understanding of how you can improve your finances. For example, if you have multiple late payments listed, paying your bills on time could improve your credit score.
- Choose a card that suits your circumstances. If you have a low income, you probably won't qualify for a credit card with a high annual fee that lets you earn stacks of frequent flyer points. Look for a low rate, low fee card.
- Update your details before you apply. When you check your credit history, make sure that your personal details (including residential address, phone number, email address and employment) are up to date before you apply.
- Reduce your spending. Before applying for another card, try to cut back on how much you spend for a month or two. This will increase your chances of success.
- Apply jointly. If you have a partner, making a joint application can boost your chance of success, especially if you both work. This probably won't work if one (or both) of you has a low credit score though.
- Have your supporting documentation ready. Credit card issuers require a range of documents before they can process your application. This includes copies of your passport or driver's licence, pay slips and bank statements. This will help the bank verify your information and may speed up the approval process.
Our expert says: The fear of rejection is real
"19% of Australians say fear of rejection has stopped them from applying for a financial product — including 8% who avoided applying for a credit card and 5% who avoided applying for a personal loan. I went through a similar experience when I got rejected for a credit card. Frustratingly, credit card providers rarely tell you exactly why you got declined. But they do suggest waiting a month or two before applying again. Most of the time the reason you got rejected will be fairly obvious: spending too much, not earning enough, applying for an unsuitable card, or your credit score is too low. "
Frequently asked questions
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The other day i had a credit card application declined. The credit card was a 12% interest free on purchases (i already have a credit card that has an interest free period but about to run out, that is also not owing anything) and i have closed one credit account before, as well as paying off a personal loan very early and having a car loan now. I earn pretty good money, and i don’t have many doubts about my credit history but for some reason i get declined? It just makes me wonder if the banks decline if they think someone has a TOO good of chance of repaying them before the interest free period is over (meaning they make no money, besides yearly fee) Extremely frustrating as it does not look good for someone who has an otherwise great history.
Sorry, meant to say 12 months interest free**
Hi Ktee,
Thanks for your comment.
As you can see from the page above, there are various reasons why a credit card application might be declined. Card issuer’s use a variety of criteria to determine someone’s eligibility, and unfortunately it’s not always obvious why your application might not have been accepted. As you mentioned, the card application will appear on your credit file as declined so it may be worth waiting until you apply for your next card to give yourself the best chance at approval.
Thanks,
Elizabeth
Ive applied for a credit card but have not heard anything back although their website claims a 60 second response, is this an indication that I have been rejected. ?
Hi,
Thanks for your question.
The response you received may have been that your application will take more time to process, so if you received this message then this might be considered your response. You might want to get in contact with the card issuer to discuss the progress of your application and ensure it was successfully received.
I hope this has helped.
Thanks,
Elizabeth
I know this thread is old but westpac declined my credit card application and when I spoke to them they said
It had nothing to do with my credit history nothing to do with my credit file nothing to do with my income or assets or employment status ?? So what the hell was it then? My score was good as well she said she cannot have it reviewed but I could get my branch my manager to request it be reviewed but like why would they decline it if there wasn’t a problem in the 1st place could anyone please explain?
Hi Scott,
Thanks for your question.
As you can see from the information on this page, there’s a few reasons why your application may not have been approved. The banks don’t necessarily have to advise you as to why they’ve rejected your application, but they would have their own criteria in place they you would not have met if you were to be rejected. If you feel like you want the decision reviewed then you have that option open to you, as explained by Westpac.
I hope this has helped.
Thanks,
Elizabeth
Got a home loan approved, waiting for settlement. Would getting a new credit card impact my settlement?
Hi Shant,
Thanks for your question.
This could have an impact on your settlement depending on your lender’s policies. I’d recommend speaking to your lender about whether a credit card application will affect anything.
Please note that your home loan application could have an impact on your credit card application.
All the best,
Shirley
is there away you can workout you point score before applying for a credit card
Also is there a guide line on how much to apply for against earnings
Hi Hilda,
Thanks for your question.
You may want to use some of the credit limit calculators available online, though these should be treated as estimates only.
Unfortunately there is no ‘one size fits all’ guideline in terms of earnings and your credit limit. Each bank/provider has their own criteria which they will assess you against. For more information, please contact the relevant credit card issuer.
All the best,
Shirley