Why Do Credit Cards Expire?
Credit cards expire for a number of reasons. Knowing exactly why your issuer puts credit card expiration date on a card’s usefulness may change your mind about what many people view as an annoyance.
Why Do Credit Cards Expire?
Primarily, issuers use expiration dates to anticipate when a credit card may be physically worn down and need replacing. The dates also act as an important piece of verification data.
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Online retailers use the credit card expiration date — along with the cardholder’s name, address, account number, and security code — to verify that the card in use is genuine. If a fraudulent party skims a cardholder’s magnetic stripe, they may be limited in how they can actually use the information to make purchases.
After being swiped and/or dipped on a regular basis, credit cards — just like anything else — will begin to physically break down over time. Wear and tear can present functional issues for important components of the card like the magnetic strip, EMV chip, and cardholder’s identification image (if your card has one). Having a set expiration date will often result in a card’s being replaced before it is rendered inoperable, allowing you uninterrupted use.
Technology and Design Upgrades
Payment technology is developing all the time, and sometimes issuers will force an expiration of your card to accommodate new technology that makes payment easier, faster, and safer.
The recent EMV chip card rollout is an example of this. (You may have received a new card in the mail with a note saying that your old card will expire early.) While EMV chips haven’t necessarily made payment easier or faster, they do make it more difficult to commit fraud at chip-enabled point-of-sale terminals than traditional magnetic-strip cards.
Issuers will also use a card’s expiration date as an opportunity to update its visual design. Although there’s no obvious functional benefit to aesthetic, it can be nice if your card’s style is freshened up.
What Should I Do When My Credit Card Expires?
An issuer will almost always send you a new card prior to your active card’s expiration date. To avoid interruption, you’ll want to make sure that your address information is accurate on all credit card accounts, otherwise there’s a possibility your issuer will send a replacement to an old apartment or home.
If you haven’t receive a replacement: In the event your card expires and you haven’t received a new one, simply contact your issuer using the number on the back of your existing card, and explain your situation. They’ll likely send a replacement card with a new expiration date.
Update automated payments: If your old card was used for automated payments on things like gym memberships, cell phone bills, or any other subscription-based payment, you’ll want to update this information upon receipt of the new card to avoid service interruption.
Destroy the old card: It’s wise to destroy any old credit cards. Cutting a card into pieces — or running it through a paper shredder, if you have one — is a good practice.
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