is it better to cancel unused credit cards or keep them: Learn to say no to credit cards Issue Date: May 01, 2008


A credit score is calculated based on payment history, length of credit history, credit mix and the new credit apart from the credit utilisation ratio. With this tactic, you focus on paying off the smallest debts first and then use the additional cash to sort out bigger payments. By closing a credit card, you threat rising your credit utilization ratio and harming your credit scores.

debit card

Ans.You can use your reward points or transfer them to another card. You can also seek assistance from the bank representatives regarding the same. Step 3 – Send this request to your bank account manager, and a bank staff member will contact you and explain the next steps. By clicking on the hyper-link, you will be leaving and entering our partnered website which will display recurring payment details enabled on your Kotak Bank Credit / Debit Card.

What Is A Credit Report?

When this remains unpaid for a long time, it becomes a significant overdue amount and hurts the credit score. You have seen that an inactive card can affect your credit score. At the same time, you also realize that holding multiple cards is a challenging task.

To raise an online request, you need to visit the bank’s website, fill up the form and submit the request. Once the request has been made, a representative of the bank will call to confirm the cancellation request. You can also close a credit card by sending a written request to the credit card issuer. You need to mention all the details regarding the credit card you want to cancel and send it to the authorities of the credit card issuer by ordinary post or registered post.

Home Loan

If you do not follow the proper steps in closing the card, there may be a case when there is an outstanding balance on your card. For instance, if you do not get an acknowledgement from the bank, the bank may charge renewal fees which will get showed as unpaid dues, even though you may have cut the card. If you close your credit card using the right method, your credit score will not be affected at all. Kindly note that I have cleared all my credit card dues and have zero balance on my credit card.


When a judgement is filed it’s reported to the credit bureaus, and can damage your credit score score. It’s not till the account drops off your credit score report that your credit score age could be affected, significantly if it’s your oldest bank card. It is feasible that canceling your credit card may lower your credit rating. Because credit score is essential for establishing monetary accountability to lenders, renters, and collectors, sustaining a great credit score is essential.

While closing credit cards, customers must remember that it can often impact the CIBIL score.

With a higher score, access to personal loans and new credit cards gets easier and hassle-free for you. All said and done, you don’t always need to continue holding on to an army of Credit Cards. There are ways to decide which ones still make sense for you and which ones need to be closed. For instance, if you have an unused Credit Card that has a high interest rate or annual fee , closing it is better than letting it affect your finances adversely.

utilization ratio

This follow keeps the card energetic and your steadiness nicely under your credit score limit. It also demonstrates that you simply consistently handle debt well, which might help improve your credit scores. Carrying a excessive steadiness on your credit cards has a negative impression on scores because it will increase your credit utilization ratio. Next, learn this web page to learn about how closing a credit card account impacts your credit score reviews and scores to resolve whether or not you should close the account or not.

So, even if you pay the entire balance after receiving the statement, your credit report will still show that the balance is to be paid. To be debt-free, you must thus pay the entire balance before the closing date of the statement. If some of your credit cards have balances due, then the credit utilization ratio will increase.

bank cards

Remember, if you already have a weak score, then work on improving your score first before proceeding to cancel the cards. Credit cards are touted as the best, as well as the worst financial product as careful u… It is better to close the cards that are expensive and do not serve many purposes to you. Instead of renewing the cards and keeping it alive without using it, you can better close the Credit Card account.

How to Close a Credit Card without hurting the Credit Score

However, if you wish to close more than 1 card, you should do so gradually and not all at once. explains the things to be kept in mind while canceling a credit card. Now get Rs. 500 for the delay of processing your credit card closure request and various… If you are on vacations and running short of money then using credit card is a good opti…

  • Your credit score displays the list of the credit inquiries made by the banks for the purpose of processing your loan/ credit card applications.
  • Some ways such as availing of a new credit facility and lowering your credit utilisation percentage can have a quick positive impact on your score.
  • Online request – You can also place a credit card cancelation request online on the bank’s official website.
  • Having plenty of credit cards gained’t essentially damage your credit scores considerably if you handle them responsibly.

The customer care executive will block the card either temporarily or permanently, as per your request. Reporting and blocking the card will ensure no liability if any unauthorised transaction takes place in the future. The credit card issuers usually mention the customer care number on the back of a credit card. So, if you have a picture of your card, you can easily get the right contact number to report the loss of your credit card.

Doing this can assure that your lender does not charge any is it better to cancel unused credit cards or keep them charges and has registered the cancellation request. It is advised against cancelling credit cards because it may negatively affect your credit score. However, it may be worth cancelling your credit card if the annual fees and interest rates are high.

Here’s What Happens if You Never Cancel a Credit Card – The Motley Fool

Here’s What Happens if You Never Cancel a Credit Card.

Posted: Sat, 04 Feb 2023 08:00:00 GMT [source]

After the Home Loan Approval, you can proceed with the closure of the Credit Card. The length of the credit history is a critical aspect as well. What does an inactive card have to do with the length of your credit history?

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