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Why Do Credit Cards Expire?

Have you ever wondered why your credit card expires? I recently had this happen to me. My MBNA Smart Cash Mastercard was nearing its expiry date. I was wondering when the new credit card would arrive. Thankfully it arrived about a month before it expired.

That begs the question: is an expiry date on credit cards even necessary? Let’s look at why expiry dates exist and what they’re used for.

Why Do Credit Cards Expire?

Although we may be moving towards a cashless society, credit cards are still a piece of high-tech plastic. As such, they wear out after a while. The chip and strip will stop working on your credit card eventually, so your credit card needs to be replaced.

There’s another reason credit cards expire. To ensure you have the most up to date credit card technology. Once upon a time credit cards didn’t have chip-and-pin technology or contactless payment. You had to swipe and sign for every single credit card purchase (what a pain in the neck!). Then PayPass and payWave came along and made our lives a lot easier. Imagine if our credit cards never expired. You might be carrying around your old, outdated credit card for years.

Sending out a new credit card is also another opportunity for your credit card company to get in touch with you and offer you new products and services – such as credit monitoring services.

What Should You Do When Your Credit Card Expires?

If your credit card is expiring, there’s no need to fret. Your credit card company should mail you a brand-new, shiny credit card. I got mine a month early, but some credit card companies mail them as short as a couple weeks before they expire. Your new credit should come with the same credit card number and a new expiry date. It should also come with a new three-digit CVC2 code on the back. Your new credit card should last for a few more years (mine is good for another three years).

As a cardholder, although there’s not a lot to do when your credit card expires, there is some legwork to do. You’ll need to activate your new credit card. These days activating your new card is easier than ever before. You can active it online or by calling a toll-free phone number.
Once your new credit card is activated, don’t forget to get rid of your old one. Be sure to cut it up into a bunch of pieces and toss it in the trash (make sure your credit card number isn’t visible, in case someone goes through your trash).

Transitioning to Your New Credit Card

When you receive your new credit card, you should also receive a new cardholder agreementon it. Be sure to take the time to read through it. You’ll want to see if anything has changed. Did the interest rate go up? Is your credit card company now charging you an annual fee? You won’t know unless you take the time to read the enclosed information.

If you have a balance owing on your old credit card, no need to worry. It will be automatically transferred to your new credit card (you don’t have to pay it off all at once if you don’t have the money).

The Bottom Line

As you can see, there’s nothing to worry about when your credit card expires. Just make sure you remember to activate your new credit card and you should be fine.

If for whatever reason, you don’t receive your new credit card and it’s within a week of expiring, be sure to contact your credit card company. Maybe the new card got lost or stolen in the mail.

By staying on top of your credit card expiry and renewal, you can make sure everything goes smoothly and avoid possible fraud.