Cancelling your credit card isn't hard, but you can follow these steps to make it even easier.
Whether you've paid your balance and want to get rid of your credit card, want to move a debt to a 0% balance transfer card or are looking to upgrade, there are plenty of reasons why you may want to cancel your credit card. Cancelling your credit card isn't difficult, but there are a few steps that you'll need to make sure you do properly to keep your credit score intact. You can use this guide to learn the steps you'll need to take to close your credit card account and get your finances in order.
How to cancel your credit card in five simple steps
Cancelling your credit card isn't as simple as cutting up your card. These are the steps you should follow to close your account:
1. Pay off or move your outstanding balance
Before you can close your card, you need to pay off your account in full, so you'll need to pay off your balance (and any interest owed) before you ask the bank to close the account. You should keep in mind that you'll also have to pay off any debts that are coming from direct debits. If you try to close your credit card with an outstanding balance, the bank may refuse, increase the interest rate or demand full and immediate payment.
If you want to cancel your card because you're struggling to repay a debt that's collecting interest, you can move it to a card with 0% on balance transfers to pay it off without interest for a promotional period. Not only will you save on interest costs, but you may also pay down your debt faster.
2. Move direct debits and reward points
If you have any direct debits linked to your account (such as phone bills or rental payments), you will need to cancel these or move them to another account before you close your account. Otherwise, you may not be able to close your account if a direct debit has come out and added to your debt or you could default on a payment if it's connected to a cancelled card. Direct debits can sometimes reactivate a cancelled card, so it's best to do this before you even ask the bank to close the card.
If you have a rewards credit card, you should also spend or move your reward points before you cancel your card. If you have a frequent flyer credit card that's linked to an external program, such as Qantas Frequent Flyer or Velocity, you shouldn't have to do anything with your points. But if it's linked to a bank rewards program such as ANZ Rewards or St.George Amplify, you should either redeem your points for rewards or try to move them to a partnered program (usually a frequent flyer program or hotel loyalty scheme). If you don't and you cancel your card, you won't be able to spend your rewards and they'll go to waste. You can read our guide to transferring credit card rewards points to frequent flyer points for some tips.
3. Call to cancel your card
Once you've paid your balance, you can contact your bank or card provider to cancel your card. When you make the call, you may be transferred to a customer service representative whose job it is to retain customers. They may offer you a lower annual fee, reduced interest rates or bonus points, but if you're determined to close your account, you shouldn't be swayed by these offers. Instead, you should insist that you want to close your account.
You'll usually need to confirm your identity to close your account, and some banks may require that you send a written request or visit a bank branch. If you can cancel your card over the phone, make a record of the date, time and name of the representative you spoke with in case you need to chase up the account closure.
You can find a list of the Australian bank customer service numbers you can call to cancel your card on finder.
4. Check for future statements and confirm the cancellation
Once you've received confirmation that your card is closed, you should try to log into your account or go through your credit card statements following the request to ensure that it has indeed been closed. If it hasn't, you can contact the lender again and request that it be closed immediately.
5. Cut up your card
Once you're sure that your card is closed, you can cut up your card. Although the card won't be of much use if the account is closed, it's wise to cut it into as many pieces as possible and discard them in a few different places (such as in the bin at home, at work and in public areas).
Closing your credit card can be a simple process as long you know the steps to follow. If you've closed your card and are in the market for a new and competitive offer, you can start comparing your options below.