8 reasons your card may be declined

By Marianne Curphey

card-declined

Helen Hall*, 34, recently tried to pay for dinner at a restaurant in a holiday resort - only to have her card declined.

"It was particularly embarrassing because I was out with a group of friends, and someone else had to step in and pay my share," Hall says.

Few things are more frustrating than a credit card being declined. But it can happen to anyone, for various reasons - even to celebrities. Megastar Adele's card was declined in 2016 at a store in California.

"I went to H&M and my card got declined," the Grammy winner told the audience at a concert in San Jose. "Oh, my days, pretty embarrassing."

As E Online reported, somehow no employee noticed that it was the "Hello" singer whose card transaction was denied. "Nobody knew it was me," she said, "but I was mortified."

Understanding why cards get declined may help you avoid rejection when you pay, and help you know what action to take if you do find yourself in that position.

8 reasons your card might be turned down

1. You've used it more than five times in a row for contactless purchases.
You can use your contactless card as many times as you like, but if you make a lot of transactions in a short space of time, you may be declined for a "tap-and-go" transaction, in which you don't need a PIN or signature. You may be asked to enter your PIN, just so that your bank knows it is you.

2. You try to tap-and-go for a purchase over £30.
Contactless tap-and-go payments have become so popular in the UK that the maximum payment amount was increased in 2015 from £20 to £30 per payment.

However, it is still limited, and if you try to spend more than that, you'll be asked to input your PIN instead.

3. Failing to remember your Verified by Visa or Mastercard SecureCode password.
Visa and Mastercard each have 3D Secure schemes: Verified by Visa and Mastercard SecureCode. With 3D Secure, you get an extra layer of protection when you shop online, as it requires your Visa or Mastercard password to complete your purchase.

However, if you can't remember this password, you'll need to provide more security details to show that it is you.

4. Fraudulent or suspicious activity on your account.
If your credit card provider or bank suspects fraudulent charges, it may decline the card to protect you. It's more common if you're on holiday and using the card in an unusual place, or if you are trying to buy a one-off expensive item. 

If this happens, your card issuer will likely call you to verify that you are the one making the purchase, and you may be able to verify and use the card right away. You can get ahead of the curve by calling your card issuer before you travel or before you make a large purchase.

5. Using your card unwisely.
There are basic credit card rules you must follow if you want to maintain access to your card: you must make payments on time, you must not exceed your credit limit and you must not exceed your daily spending limit.

If you fail to follow these rules, you may receive warnings in the post, and your card account may be frozen if you continue to ignore the issue.

6. You have a hold on your card.
When Hall called her credit card company after the restaurant incident, it turned out that both her hotel and a car hire company had put a hold on her card, which made it appear that she was right up to her credit limit.

This is common with companies such as hotels, where you give your card upfront but the final total isn't certain until you check out. The company can issue a hold on your credit card to cover the cost of the stay or hire, and any incidental expenses or accident damage.

If you pay your final bill with the same card you used at check-in, the hold will come off. However, if you pay your bill with a different card, it may take a few days before the hold is removed, which would affect your credit limit in the interim. A similar situation occurs if there is a payment pending which reduces your credit limit.

7. You've incorrectly entered your PIN several times.
If you punch in the wrong code three times in succession, your bank may automatically deactivate your card for the sake of your own protection, as it is a sign of fraud.

You'll need to call your issuer and answer some security questions to have your card reactivated.

8. Your card is expired, your billing address is wrong or the card isn't activated
It may sound basic, but your card and information must be current.

With credit card accounts with authorised users, it's possible that one user may cancel the card account and the other user has no idea. If you're in an authorised user partnership, be sure you're always communicating with the other user.

If your card expires, you may not use it any longer. You'll receive a new card in the post, and you must activate the new card before you can use it. The new card will come with instructions on how to activate it.

Why do we find it so embarrassing to have our card declined?
According to Alex Hedger, clinical director of cognitive behavioural therapy clinics at Dynamic You, our emotions play a large role in the way we react to money.

"Money is caught up in our perception of status and self-worth," he says, "and can ignite strong feelings of anxiety and pride."

Simonne Gnessen, money coach and founder of Wise Monkey Financial Coaching, agrees.

"We spend to create an image of the person we want others to think we are," Gnessen says.

When that image falls short of our expectations, it can feel like social humiliation. You may feel like others will think you can't manage your money properly, or that you appear too poor to afford your purchase. Worse, you may feel like the cashier or your friends think you're using the card fraudulently.

However, it's important not to get flustered if your card is declined. Cashiers see it happen every day, and almost anyone with a card can sympathise with the feeling and understand that it's likely out of your control.

If your card is declined and you're certain that you have the funds to pay for your purchase (and your account is current), calmly ask the payee to run your card again. If the transaction fails again, call your bank and make sure you are not a victim of identity theft.

The most important thing is: don't panic, and don't get angry with a cashier or your credit card issuer. Chances are, a quick phone call to your card issuer can smooth out any wrinkles in your transaction.

*Name changed for privacy reasons.

See related: Is overpaying your credit card bill a good idea?, Prioritising debt: Which bills are essential?

Updated: 20 April 2017