Why Do Credit Cards Expire?
It seems like everything comes with an expiration date these days. From canned beans to batteries, you’ll find expiry dates on a lot of things, including credit cards. Why exactly do credit cards come with expiry dates? It’s not like your credit card will spoil. To many, your credit card’s expiry date is just another field to complete when making a purchase online. While your expiry date may seem like an afterthought, it serves an important purpose for issuers as you’ll soon find out.
Although your expiry date may not seem that important, it’s actually a powerful weapon against fraud for credit card issuers. How does your card’s expiry date prevent fraud? Whenever you swipe your card, merchants confirm your identity through authentication by sending the payment information entered to the card association for account validation and routing.
While thieves are often able to get their hands on credit card numbers, they don’t have such an easy time with expiry dates. Even if fraudsters are able to clone your card, without a valid expiry date it won’t be worth the plastic it’s printed on. Chip-and-PIN credit cards are even harder to clone; when you receive one in the mail you’ll have the added protection of the latest technology.
When your credit card expires, this provides your issuer with the opportunity to send you a new credit card with the latest technologies. If you still have a traditional credit card with a magnetic stripe, chances are your issuer with send you a Chip-and-PIN card upon expiry. Although Chip-and-PIN credit cards typically last a lot long than credit cards with magnetic strips, they still wear out eventually.
Offers and Promotions
When your credit card expires, it’s the perfect time for your issuer to get in contact with you about new offers and promotions. For example, if you’re carrying a balance on another credit card, your issuer may offer you a 0% balance transfer for a limited time. If you always pay your balance on time, your issuer may reward you with a higher credit limit.
Updated Branding and Card Art
Like any large company, credit card companies are always updating their image. Every time you pull out your card or hand it to someone for a purchase, that is an opportunity to show off the company logo. Over time, credit card images change and the issuers want to be sure their image remains nice and shiny. But perhaps most of all, a shiny new credit card could encourage you to keep spending.
Receiving Your New Credit Card
Your issuer will usually mail you a new credit card a few weeks before your old card expires. You will need to activate the new card before you can start using it. Simply call your issuer’s toll-free number or logon to their website to start using your new card. Once your new card has been activated, you should cut up your old card. Be sure to sign the back of your new card!
While your new card will generally come with the same account number, your three-digit CVC2 will be different. If you pay any recurring expenses on your credit card like your utility bill, it’s important to advise these companies of your new expiry date.
You should keep an eye on the expiry date of your credit card. You don’t want to be travelling abroad, only to discover your card has expired. If your credit card is about to expire and you haven’t received your new card in the mail, you should call your issuer. Your new card may have been stolen or your issuer may not have your new mailing address if you recently moved.
The Bottom Line
As a cardholder, it’s important to keep your eyes on your credit card’s expiry date. As we’ve explained, your expiry date serves many purposes. It help prevents fraud, can provide you with the latest technology, and gives your issuer a selling opportunity. If your credit card is about to expire and you haven’t receive a new card, it doesn’t hurt to give your issuer a friendly phone call to make sure your new card is on the way.