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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Hi, i applied for a credit card in order to do a balance transfer for my two credit cards. The credit cards are in my name, and i applied for the new one as a joint application with my partner. I have been employed 3 years, and his current employment is only 3 months in. No surprises that we were declined, i also did not list our assets as i should have. I want to apply again as a single applicant. How long should i wait between applications?
Hi Claire,
Thanks for your question.
As a general rule of thumb, one application every 3-6 months is favourable from a lender’s point of view.
Cheers,
Shirley
Hi. The other day I rang ANZ to ask if I could raise my credit card limit from $5thou to $6thou.
The first person I spoke to said there was a note on my file saying my limit could be raised to $9 thou. Unfortunately when she looked further into it she said she had to refer me to someone else. To cut a long story short and after speaking to a 3rd person, I was finally told my app was declined due to too many recent applications.
I explained that I had never had a late or missed payment in my life for anything but they said that they never approve credit to someone with too many applications; ever!
My problem is I desperately need a credit card with $500 to get out of my current financial hardship. I have been getting pay day loans and all they do is put me behind every fortnight, causing a vicious circle. $500.00 would mean I could pay my upcoming car registration plus pay back money I owe a family member and make it through to my next pay without getting yet another pay day loan. Last Nov I had to take out a personal loan with NAB (who I have been banking with for 20 years) for debt consolidation on the condition I close 3 credit cards and only keep the ANZ CC open. Any advice would be greatly appreciated.
Hi Peta,
thanks for the question.
Unfortunately as you’ve mentioned, too many credit applications in one space of time can act as a red flag for potential lenders. They might construe these applications as indicative of a spending problem that an applicant might have, or it might show them an applicant is unable to pay off their accounts. I’m not able to give personal advice regarding finances, so it might be helpful to contact a free financial counsellor.
I’ve emailed you more information about these.
Cheers,
Marc.
hi
I applied for a credit card online through ANZ. And it said unfortunately we can not give you an answer and someone may contact me for further information. Which they did, they just want my last two payslips. So this is fine. Does this mean I am conditionally approved as long as they get my proof of income. Sorry I have never had a credit card before and just wondered what it meant.
Thanks
Hi Dara,
Thanks for your question.
If they ask for you to fax in your most recent payslips after completing an application, this means you are approved pending further information. This can be called