Recent surveys show that it is every shopper’s worst nightmare when at the checkout counter. When the checkout assistant tells you that your card is suspended it is easy to fear the worst.
However, before you panic too much it is important to discover why this has happened.
When your credit card is suspended it is common to think that your issuer has closed your account. However, this is not usually the case. It could be that a temporary hold has been put on your account for one of many reasons.
It is important to understand why the account is on hold, how to rectify the situation and what impact it might have on your credit rating. Steve O’Halloran, public affairs director for Chase Card Services says,
We look at a number of factors, for example concerns about fraud, when evaluating a customer’s financial and credit situation and determining if any action needs to be taken.
One of the most common reasons why credit cards are declined is because your card issuer has reduced your line of credit. The recession, coupled with tighter regulations has resulted in many issuers lowering the line of credit extended to customers. This can result in you going over your limit if you are carrying credit card debt.
In order to have your account reactivated in these circumstances you will need to pay off your credit card account. Experts recommend opening up a minimum of 60 percent of your credit limit for use where possible. This will allow you to use the card as normal and help to raise your FICO score. As your score increases, you will become eligible for a larger credit line.
Another common reason for credit card accounts to be suspended is because of suspected fraud. If your credit card picks up any suspicious activity then they will usually try to reach the cardholder by phone. However, if they fail to make contact they will suspend the account until they can discuss the matter with the customer.
Sometimes apparent fraud is nothing more than a case of the cardholder visiting a new place or dramatically changing their spending habits. In order to reactivate accounts which have been suspended for this reason you will need to prove who you are and that you made the transactions. If the transactions are fraudulent then they will be refunded and a new card issued very quickly.