What Happens If You Don’t Activate Your Credit Card?

Do you remember the credit card you got at the check-out counter of a store and never took out of the kit? Your bank may also have pressured you into getting a new credit card when you opened your first account with them but you never activated it. But can never activating your card affect your credit score? You may think that even if you did not activate the card, you will have to pay for it and this can affect your credit score. Let us help you find out why activating your credit card is important and how it impacts your financial health:

Why is it important to activate your credit card?

Earlier, activating the credit card is the same as generating a credit card PIN for the first time. But as per new RBI guidelines, you are required to activate your card through an OTP-based process to use it for future purchases. Your card issuer will seek consent from you before activating the card or creating your card account. You are required to activate your new credit card within 30 days of card issuance. However, in case you do not provide consent to your card issuer, then your credit card will be closed by your card issuer within 7 days of seeking the consent. Overall, you are required to activate your credit card within 30 days, if you fail to do so, you will get a grace period of 7 days. After 37 days, your credit card will be closed by your issuer if you don’t activate it through an OTP-based process.

Fees and charges on your inactive credit card

You would be annoyed at the thought of paying fees on a card you have never used. If you do not activate your credit card within 37 days, then your credit card will be closed by your card issuer. Hence, there will be no fees and charges applicable to your card. So, you don’t have to worry about paying the charges even if you are not using your card. Also, any information related to inactivated credit cards that has already been reported to credit bureaus has to be withdrawn within 30 days of RBI’s new directions.

Related Article: 7 Credit Card Fees and Charges You Must Be Aware Of

Will closing an inactive credit card affect your credit score?

As we have mentioned above that you are required to activate your credit card within 37 days of card issuance, including a grace period of 7 days. If you do not activate your card, your credit card will be closed by your issuer and you cannot use it for any kind of transactions. Therefore, even if your card comes with an annual fee, you do not have to pay it as your account will be closed by your issuer. Hence, closing your inactive credit cards will not harm your credit score as no charges will be levied on it.

How to activate your credit card?

The procedure for card activation may differ from one card issuer to another. You are required to activate your credit card through an OTP-based process which will allow you to use your card for online as well as offline transactions. Here are ways to activate top credit cards by popular banks:

HDFC Bank: You can activate your HDFC credit card through online and offline ways. You can activate your credit card through OTP confirmation, which is sent to your registered mobile number. Besides this, you can also use net banking or mobile banking facility to activate your credit card. You can also activate your HDFC credit card just by enabling it for future transactions. If you are not satisfied with any of these methods, you can contact the customer care of the bank and follow the instructions given by the IVR to activate your credit card.

SBI Card: You can activate your new SBI Credit Card either by net banking, mobile banking or e-mail. You are required to log in to your net banking account and activate your card under the ‘Request’ section. SBI Card also allows you to activate your card through the mobile app. You can log in to the app and activate your credit card through the OTP confirmation. Additionally, you can also use the email option available in your account to activate your credit card.

Axis Bank: You can activate your Axis Bank credit card through net banking or mobile app. Log in using your customer ID and password, go to the credit cards section and set your PIN by entering the OTP sent to your registered mobile number. You can also activate your card by visiting any of the nearest Axis Bank ATMs.

ICICI Bank: ICICI Bank allows you to activate your new credit card through multiple ways, such as internet banking, mobile banking, ATM and customer care. However, you will need an OTP for the credit card activation, which will be sent to your registered mobile number.

Kotak Mahindra Bank: You can activate your Kotak Bank credit card by contacting customer care and following the instructions given by the IVR. You can also log in to your net banking or mobile banking account using your ID and password, and activate your card by generating the PIN.