Protect your finances and your credit rating by learning how to cancel and close a credit card account the right way.
Taking scissors to your credit card may stop you from using it, but it doesn’t mean that the account has been closed. Open credit card accounts can impact your credit rating, accrue fees, and leave you open to undetected fraud. If you no longer have a use for your credit card, learn how to cancel and close it the right way in order to avoid problems in the future.
How to cancel your credit card
Closing your credit card account isn't complicated, but there are a few steps you should take before calling your bank or cutting your card in half.
- Pay off your balance. If you attempt to cancel a credit card with an outstanding balance, the bank could reserve the right to increase the interest rate or demand that you immediately pay the debt in full. If you're struggling to repay the debt because of high interest, consider transferring your balance to a card with a promotional 0% offer on balance transfers.
- Call your bank first. Every bank will have a different system for closing an account, so it won’t hurt to call ahead first to find out what yours is. If your account is in order, you could get lucky and find that closing the account is as easy as making that one phone call.
- Stand firm. You have made a sound financial decision, so stick with it. Not all credit card providers will be willing to let you go without a fight, especially if you are a frequent credit user. Keeping you is costing them less than trying to find customers to take your place. Don’t be surprised if your phone call is forwarded to a retention specialist whose sole job is to persuade to stay with your current card. They may offer you lower interest rates or other perks, but if you really don't want to use the card, politely decline and reinforce your desire to close the account.
- Send written notice. In addition to the phone call, you can send a written notice to the bank with your request to close the credit card using registered mail. In the letter, you should list the name on the account and the account number along with your request to cancel.
- Cancel any direct debits. Make sure that you change the details for any direct debits that were being paid using the credit card. A payment request from a direct debit could reactivate the card even after the issuer has received written notice that you wish to cancel.
- Transfer or use any remaining rewards points. If you're using a rewards credit card and still have rewards points leftover, either transfer them to a partnered frequent flyer partner if you have an account with them or use the points to redeem a reward to ensure they don't go to waste.
How to contact your bank to close your credit card account
The phone number on the back of your credit card is usually a good bet, but here are some ways of contacting the major card companies to cancel your card:
|ANZ||13 22 73 | 24 hours. 7 days a week.|
|American Express||Please call the number on the back of your card.|
|Bank of Melbourne||13 22 66 | 24 hours. 7 days a week.|
|Citi||13 24 84 | 24 hours. 7 days a week.|
|Coles Mastercard||1300 306 397 | Mon - Fri: 8am - 9pm, Sat: 8am - 8pm, Sun: 8.30am - 8pm|
|Commonwealth Bank||13 22 21 | 24 hours. 7 days a week.|
|GE-Money||Please call the number on the back of your card.|
|HSBC||1300 308 008 | Mon - Fri: 8am - 8pm|
|IMB||133 462 | Mon - Fri: 8am - 8pm, Sat: 9am - 4pm|
|Jetstar||1300 150 100 | 24 hours. 7 days a week.|
|NAB||1300 361 138 | Mon - Fri: 8am - 8pm|
|People’s Choice||13 11 82 | Mon - Fri: 8am - 8pm, Sat: 8.30am - 4.30pm|
|St.George||13 33 30 | 24 hours. 7 days a week.|
|Virgin Money||13 37 39 | 24 hours. 7 days a week.|
|Westpac||132 032 | Mon-Sun: 8am-8pm|
|Woolworths||1300 10 1234 | Mon - Fri: 8am - 8pm, Sat: 9am - 5pm|
What are the benefits and drawbacks of closing my account?
Closing a long standing credit card account is not an easy decision to make. Weigh up some of the following pros and cons to help make the right choice for your finances.
- Reduced temptation to spend. Without an available line of credit, you might not be tempted to make unnecessary purchases that could result in debt.
- Improved credit rating. Too much revolving credit could hurt your credit rating, especially when it comes to applying for large loans like a home mortgage.
- Fewer fees. You could save money on annual fees by eliminating the number of open credit cards you have. Plus, if you're relying on your savings account to make purchases, you won't have the burden of interest.
- Credit availability. If your credit rating is not stellar you may find it difficult to be approved for another credit card product in the future. In that case, it may be better to keep the account open and use it sparingly and wisely in order to try and reestablish a good credit history.
- Emergency assistance. Credit cards are a convenient method of covering an expense in the event of an emergency. Not having one available could force you to look at other more expensive options such as fast cash loans.
As your financial needs change, you might discover that a credit card is no longer the right financial product for you. Rather than having a collection of open accounts that you no longer use, you should take the time to cancel those cards. This allows you to take better control of your spending habits and your credit report so that you can work on building a better financial future. Otherwise, if you're looking to upgrade your credit card for a more competitive product, you can use our comparison tables and guides to compare your options.