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Credit cards are a convenient method of payment that let you make cashless purchases in-person or online. However, millions of Americans fall victim to credit card fraud, according to the Consumer Financial Protection Bureau.

Identifying fraudulent activity and knowing how to report credit card fraud can help protect identity and your finances. Here’s a closer look at the process of reporting credit card fraud.

What Is Credit Card Fraud?

Credit card fraud is a type of identity theft. When a perpetrator commits credit card fraud, they’re making unauthorized purchases or cash advances using a credit card account that isn’t theirs.

Types of Credit Card Fraud

Fraudsters have developed many types of credit card scams to infiltrate unsuspecting consumers’ credit card accounts.

Account Takeover

An account takeover involves the perpetrator contacting the credit card issuer to make fraudulent changes or requests to gain access to your account. For example, they might claim to be you and request a new credit card issued to their address.

Card-Not-Present (CNP)

Card-not-present, or CNP, credit card fraud occurs when an unauthorized charge is put onto a card account without the physical card being present during the transaction. This might occur during online purchases or other instances when a transaction is performed without the physical card in hand.

Credit Card Skimming

Credit card skimming occurs when a skimmer device is placed onto a legitimate credit card sales terminal. It’s designed to look seamless and authentic. Upon swiping your credit card through the skimmer, the device captures your account data, including your credit card number, PIN, CVV number on a credit card, and more. Perpetrators can then create a copy-cat credit card with your account information encoded into it.

Fraudulent Card Applications

This type of credit card fraud occurs when someone opens a new card account under your name without your consent and/or knowledge. Fraudulent applications might lead to newly opened credit card accounts through pre-approval mailers that are intercepted by fraudsters.

Lost or Stolen Cards

A lost or stolen credit card is another common method of credit card fraud. Unlike CNP, the perpetrator obtains possession of your physical credit card and makes unauthorized charges. If your card is lost or stolen and then used before you realize it’s missing, an unauthorized user can make fraudulent changes in person or online.

Recommended: What is a Charge Card

How to Detect Credit Card Fraud

A key way to uproot credit card fraud is by staying keenly aware of the activity on your existing credit card accounts. For example, with the convenience of automatic payments, it might be easy to ignore reviewing your monthly statement since autopay lets you pay your bills without much effort.

However, if you didn’t notice an unauthorized charge come through because you aren’t keeping track of your transaction activity, it can become that much harder to thwart further fraud. Additionally, routinely reviewing your credit reports can help you flag any new credit card accounts that you didn’t activate.

You might also consider setting up credit card alerts, which can notify you when purchases or cash advances are made using your card. You can set these up through your card issuer’s mobile app and opt to receive a text message, email, or push notification. These frequent updates can help you respond quickly if anything goes awry.

Recommended: Tips for Using a Credit Card Responsibly

How to Report Credit Card Fraud

If you’ve found fraudulent activity on your card account, there are steps you can take to minimize your liability for the unauthorized charges.

Contacting Your Credit Card Issuer

As soon as you notice a fraudulent charge, contact your card issuer’s fraud department immediately. Report the unauthorized charge and explain that it was made without your knowledge or consent.

Typically, the issuer will immediately deactivate the old credit card and reissue you a new card to avoid further unauthorized transactions. If you haven’t done so already, change your online password for the compromised credit card account. Also, change the PIN for your card.

Reaching Out to the Credit Bureaus

Contact one of the three credit bureaus to submit a fraud alert. Doing so requires businesses to verify your identity before opening a new credit account under your name. This fraud alert is free to request and remains active for one year.

The credit bureau you contacted is required to inform the other two bureaus of the fraud alert on your credit. Request a copy of your credit report from each bureau and review them for any other suspicious activity.

Notifying the Authorities

Report credit card fraud to the Federal Trade Commission through its website, IdentityTheft.gov , or by calling 1 (877) 438-4338. By reporting the fraud to FTC authorities, your rights in relation to the fraud are reserved. The FTC will file the report and come up with a recovery plan.

You can also choose to file a fraud report with your local police department. Request a copy of the police report for your records.

How to Protect Yourself From Credit Card Fraud

Following a few practical credit card rules can help you reduce your exposure to potential credit card fraud:

•   Review your credit card statements regularly.

•   Observe your credit card and bank transactions for anything that’s incorrect or potentially fraudulent.

•   Track changes on your credit report.

•   Keep your credit card information private.

•   Set up mobile alerts on transactions through your card issuer.

How Credit Card Fraud Can Impact Your Credit

Credit card fraud can do incredible harm to your creditworthiness if it goes undetected. It can result in a sudden uptick in outstanding balances, which impacts your credit utilization ratio and can adversely affect your score.

It can also be problematic to your credit if new credit card accounts were activated under your name without your knowledge. In this scenario, the unauthorized account and charges incurred go unpaid, which can negatively affect your payment history.

Recommended: When Are Credit Card Payments Due

The Takeaway

Reporting credit card fraud is essential to avoid being liable for unauthorized charges or changes to your account. Stay apprised of your credit card activity by reviewing your credit card transactions at regular intervals and routinely checking your credit report for suspicious issues.

If you’re looking for a fuss-free credit card, SoFi has a solution.

FAQ

What happens when you report credit card fraud?

Upon reporting credit card fraud on your account, the card issuer initiates an investigation into the unauthorized charge or fraudulent claim. It might reissue you a new card to use while it conducts its investigation. It if confirms that fraud occurred, your maximum liability for an unauthorized charge is $50, depending on when you reported the fraud and/or lost or stolen card.

What do I do if I suspect a fraud card?

If you suspect that you were a victim of credit card fraud, immediately contact your card issuer to notify them of the unauthorized activity. Request a copy of your credit report to confirm that no other suspicious activity is associated with your credit. Finally, file an identity theft report through IdentityTheft.gov or with local authorities.

Can the bank find out who used my credit card?

The bank can trace the details of the unauthorized activity. These details include the merchant where the card was fraudulently used as payment; the transaction date, time, and amount; and the buyer’s IP address.

How do I claim credit fraud?

To claim credit card fraud, contact your credit card issuer. You can call the phone number listed on the back of your card or call the issuer’s fraud department directly to report the unauthorized activity and request an investigation.

Photo credit: iStock/Moon Safari

¹See Rewards Details at SoFi.com/card/rewards.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.


External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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There’s also a lot of important information in a credit card statement. Specifically, you’ll find details about rates, fees, transactions, payments, and any changes to your card’s rules and regulations. All of the fine print might look overwhelming, but if you spend some time learning how to read your credit card statement, it will become easier to navigate. In fact, you may even find it helpful in understanding how to manage your credit.

Keep in mind that every credit card provider’s statement looks a bit different, though they’ll share some similarities. In other words, your statement might look a bit different from our high-level overview of a credit card statement’s components. Still, this guide can serve as a jumping-off point to better understanding a credit card statement.

How to Read a Credit Card Statement

Below you’ll find an overview of each of the major sections of a credit card statement, as well as what important information you can find there.

Account Summary

This section is an overview of all of the transactions that have taken place on your credit card account during a billing period. Here are some key pieces of information you’ll find in the Account Summary section of your credit card statement:

•   Your name and mailing address: While this is information you already know, it’s important to make sure it appears accurately on your statement.

•   Your account number: The entire account number may appear, or the statement may only list the last four digits.

•   The billing cycle’s dates: You’ll see your credit card statement closing date and the length of your billing cycle, which impact how interest is calculated. The statement will only reflect activity from the current billing cycle. This means your statement may show different numbers than what you see when you look at your account online, which may include transactions that occurred after the credit card statement cycle closed (this is the difference between a credit card statement vs. current balance).

•   The previous balance: This is the previous month’s remaining account balance.

•   The new balance: This figure takes into account all of the activity for that billing cycle. Additional purchases, interest charges, fees, balance transfers, credits, or payments are either added or subtracted to the previous balance to determine this balance. If, for whatever reason, you were credited more than you owe, that would result in a negative balance on a credit card.

•   Your credit limit and available credit: This is where you’ll find your overall credit limit, as well as how much of that remaining limit is available for your use.

Recommended: What is the Average Credit Card Limit

Payment Information

In this section, you’ll find information on what is owed for the billing cycle. If you look at no other section on your credit card statement, you’ll probably want it to be this one. Here’s what you’ll find there:

•   Your new balance: This is how much you’ll owe on this particular statement. If you pay this amount in full, you can typically avoid accumulating interest charges.

•   Minimum payment: This section will include information on your minimum payment for the month. You must pay this amount to avoid late fees and negative reporting to the credit agencies.

•   Payment due date: If you fail to make the minimum monthly payment by your payment due date, you may be charged a late fee. Missing a payment might also trigger a higher penalty annual percentage rate (APR) and potentially negatively impact your credit score.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

Late Payment Warnings

Credit card statements typically have sections that state what happens in the event that a minimum monthly payment is not received by the due date listed. The late payment warning generally includes information on the penalty APR (if applicable) and the late payment fee.

Minimum Payment Warning

The minimum payment warning section explains how long it will take to pay off a credit card balance and how much interest you’ll owe if you make only the minimum payment. While it’s possible to pay off a credit card balance by only making minimum payments, the process can be slower and more costly in the long run when you factor in compound interest.

The minimum payment warning section may include details for an expedited payment schedule, such as three years, or 36 monthly payments. This can serve as a useful comparison if you’re unsure of just how much you’ll save in interest charges by making more than the minimum monthly payment.

Another way to explore interest costs over different repayment periods is by using a credit card interest calculator.

Recommended: What is a Charge Card

Rewards Summary

If you carry a rewards credit card, arguably the most fun section to review on a credit card statement can be the rewards summary. Here’s what you can find detailed in this section:

•   Prior rewards balance: This shows your rewards accrual from spending in prior billing cycles.

•   Rewards earned this period: This shows how many points or miles were accumulated over the most recent billing period through using a credit card.

•   Rewards redeemed: This will show the amount of rewards you’ve redeemed that statement period, if any.

•   Rewards available for redemption: This portion details how many points or miles you’re currently able to redeem, whether for cash or travel.

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Credit Counseling Notice

Your credit card statement may include information for nonprofit credit counseling. If you’re having a difficult time managing your credit, you might consider using this resource. These programs are typically long-term solutions, however, and may not be able to help if you’re in immediate risk of missing a payment.

If you are unable to make a payment, call your credit card company and ask about your options. Credit card companies may have ways to help.

Recommended: When Are Credit Card Payments Due

Notice of Changes to Interest Rates and Other Changes

If an action on your account triggers some sort of change to the account, there is usually a section dedicated to explaining this change (or potential change). For example, if a missed payment triggers the penalty APR rate, you must be notified of the change.

Similarly, if there are any other major changes to your account, rates, or fees, you may find more details in this section.

Recommended: How to Avoid Interest On a Credit Card

Transaction Charges

This section is a list of all of the transactions that occurred during a billing cycle, including:

•   Purchases

•   Returns

•   Any other activity that would affect the running balance on a credit card

Additionally, each transaction typically includes the following information:

•   The vendor

•   The date the transaction was made

•   The date the transaction was posted to the account

•   The dollar amount of the transaction

Note that this section will only include information from the transaction period. Transactions that happened after the billing cycle will be included in the next period’s statement.

You may want to consider making a regular habit of checking your transactions each month to look for any errors or potentially fraudulent activity. If something looks suspicious, report the activity to your credit card company.

Fees and Interest Charges

Credit card statements typically have a section dedicated to fees and interest charges. In this section, you may find the following:

•   Interest charges by type of transaction: You may be charged a different interest rate for purchases than for balance transfers or cash advances, for instance. This section will break down the APR for each transaction type.

•   Interest charge calculations: In this section, you’ll be provided with the calculation for how interest was charged on each type of transaction.

•   Year-to-date total of all fees and interest: Credit card statements may also include a total of all fees and interest charged for the current year.

The Takeaway

As you can see, your credit card statement contains a wealth of information. Learning how to read a credit card statement can ensure you have all of the details you need to be an informed cardholder. Plus, understanding a credit card statement can help you learn how to better manage your credit and take advantage of all that your card has to offer.

Perhaps one of the most exciting credit card statement sections to review is the rewards summary — but you need a rewards credit card for that to be included. If you’re looking to earn rewards through your everyday spending, consider a cash-back rewards card like the SoFi credit card.

¹See Rewards Details at SoFi.com/card/rewards.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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There are several reasons why your credit card might get declined when trying to make a purchase. For instance, it could happen due to insufficient funds or because you’ve maxed out your card. Ultimately, the reason why your card is being declined depends on the particulars of your situation.

Awkward? Frustrating? Embarrassing? You bet. And in some instances, having your card get declined — especially when you have money — can be worrisome and costly. Let’s take a look at seven common reasons why your credit card may get declined and what you can do if it happens to you.

What Does It Mean for Your Credit Card to Be Declined?

When a credit card is declined, something went awry, and your transaction wasn’t processed. In turn, you won’t be able to make a purchase with that card. That’s because the credit card issuer did not provide authorization on your account — an essential component to what a credit card is and how credit card transactions function.

Sometimes, your credit card is declined due to what turns out to be an easy fix — for instance, a simple blunder like punching in the wrong ZIP code or a chip malfunction. In other cases, the reason might be something more complex and require steps to resolve before you can resume using a credit card.

7 Reasons Why Your Credit Card May Have Been Declined

Standing at the register wondering, ‘Why is my card being declined?’ Knowing the reason can help prevent the situation from happening again and ensure that future transactions go through smoothly.

1. You’ve Met Your Credit Limit

If you’ve maxed out your card — meaning you reached your credit limit — the issuer might block further purchases from going through.

Your credit limit is how much credit a card issuer extends you on a particular card. This amount varies from cardholder to cardholder, and it hinges on a handful of financial factors. You can find your credit limit on your credit card statement as well as in your cardholder agreement.

You’re more likely to reach your upper credit limit if you’re carrying an existing credit card balance. Beyond causing your credit card to get declined maxing out on your card — or getting close to it — can ding your credit. That’s because it increases your credit utilization rate, which is a factor in determining your credit score. It’s generally recommended to keep your credit usage below 30%.

What to do: Pay down your balance. You can also request a higher credit limit, but this could open the door to racking up more debt.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

2. Your Transaction Was Flagged as Suspicious

Wondering ‘why is my card getting declined when I have money?’ In this scenario, it could be due to something entirely out of your control. For instance, the card issuer might block a transaction from going through to protect you from fraudulent activity.

Fishy purchases might include a transaction for a big-ticket item or a first-time purchase from a website or app. Or, it may raise a red flag to the card issuer if you use a card after a long dormant, or if there’s a cascade of purchases made in different locations within a short period of time.

What to do: Often, the card issuer will contact you to let you know that there’s been suspicious activity on your card and that your card has been temporarily blocked. You’ll be asked to review the last few transactions to make sure they’re indeed legitimate and that they were made by you. You can also reach out to the credit card company to see why your card has been blocked.

3. There’s a Large Transaction Pending

A merchant might request a credit card hold on your account if you make a large-ticket purchase. That’s because the merchant wants to ensure it will get paid what it’s owed. If there’s a hold on your card, that means that a portion of your credit limit is set aside, which could prevent further transactions from being authorized.

Holds are also common for transactions where the grand total might not be determined when you make an initial payment — think hotels, resort fees, purchases on cruise ships, and car rentals. The hold is usually lifted a few days after a transaction is cleared, if not sooner.

What to do: You can clear a hold by either reaching out to your credit card issuer or the merchant and requesting that it’s lifted. While there are no guarantees, it’s worth asking.

Recommended: What is the Average Credit Card Limit

4. You Provided Incorrect Payment Details

Punching in incorrect payment details — think your billing address, card number, credit card expiration date, or security code — can result in your card not going through. And when you’re trying to use your card at the gas pump or at a brick-and-mortar store, entering the wrong ZIP code on the keypad can also trigger a “card declined” message.

What to do: Double-check all information before attempting to resubmit payment. Or, if you’re making an in-store purchase, consider using a mobile payment platform.

5. You’ve Defaulted on Payment

One of the significant consequences of a credit card late payment is that your card issuer might block you from making further purchases. A single late payment usually won’t trigger this result, but if you’re late for several months in a row, you might default on your card. In turn, your transactions might not go through.

Not only does falling behind on your payments impact your ability to tap into your card to pay for things, but it also dings your credit. Plus, it can trigger late fees.

What to do: Make a credit card payment as soon as you can. Once your payment is posted, your card should be unblocked and you can start using it again.

Recommended: When Are Credit Card Payments Due

6. Your Credit Card Is Deactivated or Expired

Cards usually expire three to five years from its issue date, after which point you can no longer use the card. Because the period until expiration varies, don’t forget to glance at the expiration date on a credit card if it’s been some time since it’s gotten some use.

You also won’t be able to use a credit card that’s been idle for a long stint or deactivated entirely. How long it takes for your card to be deactivated due to a lack of use will vary.

What to do: If you’re juggling multiple credit cards, remember to routinely check the expiration dates. You might also consider keeping a log of when each card expires, or when you last used it.

7. Your Purchase Was Attempted While Traveling

If a purchase was made in Prague and you live in Pittsburgh, this could alert the card issuer of potentially suspicious activity. In turn, a temporary freeze might be placed on your account.

What to do: Set a travel notification before you depart. Some card companies make it easy for you to set a notification on its mobile app. Otherwise, give the issuer a call to give them a heads-up of your travel dates and planned destinations.

What to Do if Your Credit Card Is Declined

The steps you’ll need to take to get to the bottom of a credit card getting declined largely depends on why it happened. In general, however, here are some moves you should make if your card was declined.

Contact the Credit Card Company

Reaching out to the credit card company can help you figure out exactly why your card was declined. If it was due to reasons such as suspicious activity or because you were traveling, you can verify the transactions. In turn, your hold can get lifted.

Verify Account Details

Incorrect information stored on retailer accounts, payment platforms, and your digital wallet could result in a failed transaction. Check to make sure the details on the cards on file are accurate.

Make a Card Payment

If you’re behind on your payments, make a credit card minimum payment as soon as possible. Once the payment goes through, the card issuer will likely unblock your card.

Preventing Your Credit Card From Being Declined

To avoid a declined credit card in the first place, mind these steps:

•   Set card alerts. Signing up for email or text alerts for your credit card transactions will help you stay on the lookout for suspicious activity. You can get notifications when purchases are made over a certain threshold or for any in-store, online, or over-the-phone purchases.

•   Keep tabs on your card balances. Monitor your spending and check how much of a balance you have on your cards. Stay below your credit limit to remain in the clear. As discussed previously, maxing out your cards — or nearing the threshold — will put you in danger of a declined credit card.

•   Stay on top of your payments. Make it a priority to stay on top of paying off your cards. Pay at least the minimum amount required by the credit card payment due date. Consider putting your card payments on autopay, which will help you ensure you make your payments on time. On-time payments will also help boost your credit score and avoid late or returned payment fees.

•   Set travel notifications. Some credit cards have a travel notification feature on their app. Before you depart, reach out to your card issuer to let them know when and where you’ll be traveling.

The Takeaway

Having your credit card declined while trying to pay for something can feel frustrating. It’s important to figure out why your card is being declined, whether it’s due to late payment or an expired card. From there, you’ll know what steps to take to prevent it from happening again and ensure that you can use your card when you need it.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Can a credit card be unblocked?

Yes, you can unblock a credit card. How you’ll do so depends on the reason it was blocked in the first place. As such, you’ll first want to get to the bottom of why your credit card was blocked. Then, you’ll need to take the necessary steps to release the block. For example, if your card was blocked due to suspicious activity, you’ll need to call the card issuer and confirm you made the last few purchases.

How long does it take to unblock a credit card?

It depends. If it’s a temporary block, your card can get unblocked immediately. But in other instances, it can take a couple days or even a couple weeks to unblock a credit card.

How can I check the status of my card?

You can check the status of your card by logging onto your account via a computer or mobile app. You can also check its status by calling the customer service number listed on the back of the credit card and inquiring.

How long does it take for a declined transaction to come back?

It depends on the card issuer and the reason why the transaction was declined. In some cases, it can take a few days. And in other cases, it can take longer.

Photo credit: iStock/bernardbodo

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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