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

Sometimes, you apply for a credit card and later realize that it does not suit your requirements. In such cases, you may decide not to activate your credit card because you would rather not use it. Since opening a new credit card account can impact your credit score, it is important to understand what to do if you decide not to activate your credit card.

Here’s what happens if you don’t activate your credit card and how it impacts your credit score.

Impact on credit score by a credit card you never activated

Earlier, as soon as you get approved for a card, the first thing that the issuers did was to create your new credit card account. Based on this new account, your physical card was created and then linked to it. Now, credit card issuers can create your credit card account only after the activation of your credit card, which is only authenticated via an OTP based process. Thus, now the card issuer cannot create a credit card account, on the issuance of a credit card, unless a card is activated. Thus, in-activated credit cards have no impact on your credit score.

Additionally, the issuers cannot share your information with the credit bureaus if you don’t activate your card. Even if they do, the issuers need to inform the cardholders about any information that is being shared with the credit bureaus regarding repayment records, credit history, etc. That ways, cardholders can keep a check on what is being reported to the bureau, and if any false credit card account is part of the report. You are not liable for a maintaining a card account for a credit card you never activated.

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. Hence, closing your inactive credit cards will not harm your credit score as no charges will be levied on it.

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.

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: