card-declined (1)

Take preventive measures beforehand and you will never have to worry about dishonour fees

Information verified correct on December 6th, 2016

Avoid embarrassment when you checkout by fixing debit card issues beforehand.

A debit card differs from a credit card in that the funds you are using are being withdrawn directly out of your banking account. This allows you to make transactions like purchases and even ATM withdrawals without you having to pay interest charges. Yet like a credit card, the merchant or provider can deny the transaction for a number of different reasons. Knowing the possible causes ahead of time can help you to avoid being turned away when checking out.

If you find that none of the proposed fixes below help with your situation, please get in touch with your bank directly to troubleshoot the issue.

Reason 1: You don’t have enough funds

This is likely the most common cause of a debit card being declined and one that you can easily avoid by keeping careful track of your spending money. Unless you have a linked overdraft facility, most banks will not allow you to make a purchase or withdrawal that extends your available balance.

How to avoid it:

Check to see if your financial institution offers a mobile app that shows your up to date balances and transactions. You can check this before making your purchases to ensure that you have enough funds to cover them.

Reason 2: You’ve made an international purchase

Many accounts now offer Visa or MasterCard debit cards, which allow you to use them when travelling overseas. This is a convenient and secure way to make your overseas purchases and ATM withdrawals. Unfortunately, it does not always work the way you intended it to, and you could find yourself without access to your account if your debit card is declined.

How to avoid it:

Familiarise yourself with the ATM networks that accept your debit card overseas. You should also inform the bank before making your trip so that they will not flag your purchases as unusual activity. This should usually help in making sure that your money is always available to you. If you bank with CommBank, you can notify them of your travels through NetBank – you don't even need to go into a branch!

Reason 3: Your bank was suspicious of the transaction

Most banks do reserve the right to decline any transaction that they deem to be out of character with your normal spending or withdrawal habits. In most cases this can be cleared up at the register with a quick call to the bank, but it still could cause you some embarrassment. Banks such as ANZ have security features in place, such as ANZ Falcon. Sometimes, they can be a little too safe and block authentic transactions.

How to avoid it:

If you have plans on making a large purchase, notify your bank beforehand to get pre-authorisation.

Reason 4: You’ve reached your withdrawal limit

To help protect your funds, most financial institutions will have daily withdrawal limits on your accounts. This will often be a combination of ATM and EFTPOS withdrawals, and can prohibit you from obtaining the cash you need.

How to avoid it:

Know what the daily withdrawal limits are for your accounts, and if you know that you will need to exceed them, inform the bank ahead of time. In most cases they will extend the daily limit for you if given notification. You can also check these online.

Reason 5: The information you’ve entered doesn’t match your personal details

This is a common occurrence when making online purchases, as the merchant takes extra precautions to verify your identity. This could be done by asking for your mailing address or other identifying details.

How to avoid it:

Before making a purchase online check the account paperwork and be extra careful and triple check everything – so that you know exactly which information you entered when applying for the card or account.

Reason 6: It’s expired

Some debit cards also have expiration dates like a credit card will have. If yours has expired, it will not be accepted at ATMs, EFTPOS terminals or online.

How to avoid it:

Check the date and know when the debit card is due to expire. Ask for your replacement card well in advance of that date to avoid not having a convenient way to access your account. Just make sure that you destroy the old card, as it does contain personal information that you don’t want others to be privy to.

Reason 7: Your joint holder deactivated your card

If you have opened a joint banking account with your spouse, partner, or other family member they could be allowed to deactivate your debit card without permission from you. This will cause your card to not be usable for making purchases or withdrawing cash.

How to avoid it:

With a joint account you can opt to make it necessary for both account holders to sign for any major changes to it, including adding or deactivating any debit cards.

Reason 8: You entered the wrong PIN

The personal identification number (PIN) you chose must be entered correctly in order for some transactions to be allowed. If you enter that number incorrectly, the transaction will automatically be declined.

How to avoid it:

Memorise your PIN and try not to confuse the cards if you have more than one account with a linked debit card. It is never suggested that you write the PIN on the card or keep it in your wallet as this will make it easier for a thief to access your account if your wallet or purse is stolen.

Frequently asked questions

Will I be able to fix a declined card problem while making a purchase?

Depending on the reason, a declined debit card issue may be resolved immediately. This could involve a phone call to the bank by the merchant, who will pass the call to you so that you can verify certain details.

How do I know what my daily withdrawal limit is?

Read the fine print found on the financial institution’s website, or in the documentation given to you by the bank when the account was activated. There will usually be a section that outlines how much you are permitted to withdraw daily.

If a deposited cheque has not yet cleared the account will I still be able to make a withdrawal of that money?

Only if you have an overdraft facility. A debit card can only access your available funds, not any transactions that are still awaiting authorisation.

Shirley Liu

Shirley is finder.com.au's publisher for banking and investments. She is currently studying a Masters in Commerce (Finance) and is the author of hundreds of articles. She is passionate about helping Aussies make an informed decision, save money and find the best deal for their needs.

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