There could be several reasons why you may want to discontinue using your existing credit card – You may have ended up with too many credit cards, the bank might have raised the interest rates, you are planning to leave the country or you simply don’t want to use one anymore. Whatever the reason may be, the important thing is to ensure that you close your credit card account by following the correct procedure instead of simply cutting it up and throwing it in the dustbin.

While closing a credit card account is not that complicated, there are certain things to keep in mind to ensure you don’t face any issues later. For instance, some people forget to ask for a settlement clearance letter after shutting down their credit card account which can lead to confusion in case an administrative error occurs on the issuer’s end.

Have you been planning to close your credit card account? Here’s a simple guide on how to go about the process:

Settle all the pending dues

Ensuring that you have settled all the debts is the first step towards canceling your credit card. If you have any outstanding balance, pay it off immediately so that you can proceed to apply for closure. Any delay on your part will lead to the interest amount piling up, making it harder for you to settle the liability.

Additional cardholders

There could be instances where the primary cardholder authorizes another person to use the card. If you are the primary cardholder, the liability to settle all pending dues rests with you. Once the primary cardholder discontinues the account, the secondary account will be closed down automatically. Similarly, if you jointly own the credit card, say with your spouse, you will need to consult with the joint account holder on settling the dues before you can close the account since the liability is shared.

Get in touch with the issuer

Once your dues are cleared, contact your bank via the toll-free number or through email stating that you wish to close your credit card account. The bank representatives will try to probe deeper to understand the reason behind your decision. They may even try to convince you to continue your account, but you need to stay firm and insist on ending the credit card relationship.

[Related: What Happens When You Don’t Pay Your Credit Card Debt in the UAE?]

Write a closure application

After having a word with your bank’s representative, write an official letter confirming your intent to close your account. Include all relevant details in the letter such as your credit card number, contact details, etc.

Obtain a ‘no dues certificate’ from the bank

Insist on a clearance letter from the bank after settling all pending payments from your end. This document will serve as an official acceptance that you no longer have any liability towards the bank. Such certificates can also come in handy in case of any discrepancies in the credit report or dispute with the issuer.

Check your credit report

It is important to check your credit report shortly after closing your account to ensure that the lender has updated the account status following closure. You can download the credit report through Al Etihad Credit Bureau’s mobile app or by visiting any one of its branches.

[Related: Credit Card Debt? Balance Transfer Could Be The Answer…]

Ask for a refund in case of credit balance

While closing your account, you may find that your account has some credit balance. This is an amount that the issuer owes in case of any overpayments on your part or interest adjustments. If not automatically refunded, ask the issuer to either transfer the money to another account you hold or settle with a cheque.