Debit Card Keeps Getting Declined? Here’s 12 Reasons Why.

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If you’re like most people, then your debit card is quickly becoming your preferred form of payment.

A debit card the perfect way to pay for things without having to worry about carrying cash around or running up a large credit card bill.

But what do you do when it starts getting declined?

You might be wondering why this has happened and what can be done about it.

In this post, we will discuss the reasons why debit cards get declined and how to fix them so that you can start using your card again!

12 Reasons Your Debit Card Was Declined

1. Insufficient funds

Not having enough money in the bank to purchase the things you need is a struggle many face on a daily basis. If your debit card is getting declined frequently, you may need to change how you manage your money.

Cutting expenses and living more frugally is the easiest place to start, by slashing your grocery bill, and finding ways to reduce your outgoings so there is more money available for you to use.

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Why is my debit card declined when I have money? 

There are many reasons that your debit card can be declined when there is money in the account, we cover the common reasons below:

2. Suspicious activity was detected

Your bank or financial institution has a complex system in place (something like Falcon) to help stop somebody from stealing your money. Sometimes the system is triggered by pure accident, but more than likely, your bank will need to talk to you to verify.

For example, your financial institution has your residency listed as New York. But then they see an international purchase in London. Either someone stole your debit card details or you are traveling and forgot to tell them.

Remember, it is best to let your bank know about any trips you are taking. That way, if something happens while you’re gone, the bank will know and they won’t think it’s fraud.

3. Your card hasn’t been activated

When you get a new card, it comes with specific instructions on how to activate it. Some banks may require you to call a phone number.

Others might need you to use your debit card at an ATM. If you’ve skipped this step, your card will be declined.

An non-activated debit card won’t work at all.

4. Your card has expired


If you have an expired card, then your bank should automatically send you a new one well in advance of the expiration date.  Unfortunately, this doesn’t always happen and you may find yourself with an expired card.

If this happens, then you will need to contact your bank and ask for a new one. Make sure they expedite it.

Pro tip: I always request new cards three months before my old cards expire to reduce the risk of issues between expiry dates.

5. The card type isn’t accepted

Make sure that the place you want to buy something from accepts your debit card.

Most places will take a Visa, but what if you have a MasterCard? Make sure the merchant is able to accept your debit card.

6. You make a purchase that is out of the ordinary

If you usually use your debit card to purchase coffee, groceries and a bus ticket, your bank or financial institution’s fraud protection system may be alerted when you buy a $2000 sofa bed or make a large purchase.

7. Inconsistency of transaction records

Banks can decline debit card transactions that provide different information than what the bank has on file. This would usually happen with an online purchase where you enter shipping address details that are different to what your bank has on file. 

Whilst it is an extra step, it’s always best to add in the correct billing address to any online transaction.

8. Merchant has a lower daily limit than card issuer

If your debit card is getting declined, it could be because the merchant has lower daily limits than you.

Let’s say they have $500 and you have $1000 on your debit card. In this case, you may need to split your purchase over multiple transactions.

9. Chip reader not working

If your debit card is declining and you’re having difficulty making a purchase, it could be because the merchant has turned off their chip reader.

To assure that this doesn’t happen to you again, ask for an EMV-enabled terminal when trying to make a transaction.

10. PIN entered incorrectly too many times

Your card will be declined if you enter your PIN too many times which is often a sign of thieves trying to guess your PIN number.

For this reason, some banks limit the number of times you can incorrectly enter your PIN. As an example, you may need to enter your PIN only three times before the card will be declined.

11. You’ve reached your spending limit

If your debit card is declined, it could be because you may have reached a daily spending limit.

Having a spending limit in place for a debit card can help you stay on track with your finances and also mitigate the damage that can happen when a debit card is lost or stolen.

12. You have money in the wrong account

The reasons may seem obvious, but it’s possible your bank account with a debit card linked is a checking and the money you are trying to use is in savings. Don’t worry, it happens to the best of us (especially tired parents).

If you have an online banking app, this can be rectified with a simple transfer between accounts.

How do you fix a declined debit card?

Your bank will help you with all problems with your card. If the card is not working, call them and they will tell you why.

When a debit card is deactivated, it can be frustrating when you realize the bank needs to verify the purchases made.

Bank representatives will likely want to review all financial transactions at that time in order to identify any fraudulent activity.

They may reissue a new or reactivated debit card, or they may simply block the fraudulent purchase so your account stays secure

If your card is declined due to insufficient funds, you will need to add money. You cannot run your debit card without enough money in the account.

However, in some cases it may be possible for you to use it as a credit card and owe the bank instead of having available funds immediately.

You need to keep your information up-to-date with the bank – this means letting them know when you move house, change employers, go on vacation etc.

What happens if my card is declined?

Quite simply, you won’t be able to use your card for the transaction.

You will need to contact your bank or card issuer to address a declined debit card and use another payment method such as credit card or cash until the issue is resolved.

Do you get charged if your debit card is declined?

In most cases, you are not charged for a declined debit card transaction.

You might be hit with overdraft fees if your bank allows the transaction to go through and it puts your account into a negative balance.

This is usually a provision in your bank account terms and conditions. In our experience, most banks will offer overdraft protection and decline the transaction to ensure you don’t end up with a negative balance.

Can someone steal and use my debit card?

If your debit card requires a pin, then it is unlikely. But if it’s enabled for contactless payments, then yes this is a possibility.

I have personal experience with this and only discovered the transactions when I logged on to my banks mobile app.

As it turns out, my tenant’s teenage daughter had open the envelope that contained my new debit card that was sent to my old address (now rented) and used my card to spend small amounts (under $10 on three separate occasions) at Burger King.

As she had used Paywave, there was no pin required and the transactions were approved.

In conclusion

When your debit card is declined, it could be for a number of reasons. In some cases, the bank may have detected suspicious activity and has temporarily suspended your account to investigate further.

Other times, you might be trying to make purchases in an area where that specific merchant doesn’t accept cards or on a website which does not allow international transactions.

Finally, there are instances when the PIN code entered with your transaction was incorrect because it had been used too many times before (often due to fraud).  

Most issues associated with debit card declines can be resolved by contacting your bank. Check the contact details on the back of your card and talk to a customer service representative to get to the bottom of why your debit card was declined.

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About Emma Healey

Emma is a recognised family finance and budgeting expert and founder of Mum's Money. Her advice has been featured in Readers Digest, Yahoo Finance, Lifehacker, The Simple Dollar, MSN Money and more.