Common Reasons your Credit Card Application will be declined

When you file an application for a credit card, let alone any financial product or service, the bank you are applying with can take into account almost fifty different factors.

These factors determine whether or not your bank believes you are trustworthy enough to lend a credit card to.

Is the application criteria the same across Australian banks?

No – each financial provider will have their own scoring card which they will use to rate your ‘credit-worthiness’. Even within the same bank, you may be approved for one credit card but declined for another.

Different credit cards have different approval criteria – a Gold credit card may have an earnings requirement of $40,000, where as a standard low rate card may only have a requirement of $20,000.

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What are the most common requirements for credit card application approval?

As mentioned previously, there are countless factors that are taken into account when assessing your credit-worthiness. However, the bank will filter out the high-level requirements up front. These include:

• Age: You need to be at least 18 year of age for a credit card. This is the minimum across every single financial provider across the nation.
• Earnings Requirement: This could be as low as a Centrelink income for student credit cards, or up to $70,000 and over for a platinum credit card.
• State of Residency: Being a permanent Australian resident is imperative. If you are not a permanent citizen, you may be subject to stricter criteria elsewhere, or simply declined on the basis of your residency.
• Credit Rating: This is particularly important in the current economic climate as banks are becoming increasingly hesitant to lend to risky prospects. Find out more about your credit rating and credit file here.

What are the most common potential reasons my credit card application could be declined ?

#1 – A Previously Declined Application for Credit

Banks can save themselves time and resources by automatically declining an applicant who has been recently declined from a different application for credit. It doesn’t necessarily have to be with the same institution either – banks have access to your credit file which lists all your financial products, when you applied for them, and whether you were approved or not.

It is a general rule of thumb not to apply for credit within a 2 week span of being declined for a different credit application. However, you may want to consider taking an even longer gap – certain institutions apply a 3 month ‘cooling off’ period of credit rejection.

#2 – Incorrect Information & ‘Adverse Bureau’

A lot of your financial history is more public than you may think. Banks and interested in analyzing your financial history have the right to do so. Thus, providing incorrect information can deem you as untrustworthy and ultimately inadequate for credit card approval.

Adverse Bureau means your lender does not believe that the judgements and other factors are represented adequately in their scorecards, generally because the numbers were too small for their risk to be adequately represented.

#3 – Self Employed or Casual Employment

There’s nothing wrong with self employment or casual employment – however in the short term, either form can be risky and insecure. Many banks will prefer to lend to a self employed or casual applicant if they have been employed for a certain period of time. This can vary from 6 months to over 2 years.

#4 – No Documents Provided

In most cases, the financial institution you’ve applied with will have enough access to your information and financial history to determine your credit-worthiness. Sometimes this won’t be enough, and you will need to send in documented proof of what they require of you. This is most commonly a bank statement demonstrating your income.

Whether it’s laziness or forgetfulness, many applicants apparently bail on this step of their credit card approval which ultimately leads to a decline.

#5 – Poor Relationship with Bank

If you and the bank you’re applying with have had disputes in the past, this may very well affect the outcome. Consumer loyalty is slowly being phased out in importance in recent years, but remains a determining factor.

Which bank has an easy application process?

Feel free to contact info@creditcardfinder.com.au if you have a question or query and we will do our best to lend a hand.

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HSBC Credit Card	Bankwest Zero Platinum Credit Card	Virgin Flyer Credit Card	ANZ Low Rate
0% p.a. for 6 months on balance transfers & no annual fee	0% p.a. for 9 months on balance transfers & platinum benefits	0% p.a. for 8 months on balances transfers & reward points	0% p.a. for 9 months on balance transfers & low rate

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			Interest rate (p.a.)	Balance transfer rate (p.a.)	Annual fee	Cash advance rate (p.a.)
	ANZ Low Rate	A low rate on purchases, balance transfer and a low annual fee.	13.14% p.a.	0% p.a. for 9 months	$58 p.a.	21.49% p.a.
	HSBC Credit Card	No annual fee for the life of the credit card. Plus a low balance transfer offer.	17.99% p.a.	0% p.a. for 6 months	$0 p.a.	21.99% p.a.
	Bankwest Zero Platinum MasterCard	Exclusive Offer to Credit Card Finder. No annual fee credit card with platinum benefits.	17.99% p.a.	0% p.a. for 9 months	$0 p.a.	21.99% p.a.
	Commonwealth Bank Low Rate Credit Card	A low interest rate offer on purchases and balance transfers.	0% p.a. for 5 months (reverts to 12.99% p.a.)	5.99% p.a. for 5 months	$78 p.a. ($48 for qualifying customers)	21.24% p.a.
	ANZ Platinum Credit Card	No annual fee for the first year and a balance transfer offer.	19.39% p.a.	0% p.a. for 9 months	$0 p.a. annual fee for the first year ($87 p.a. thereafter)	20.99% p.a.

* The credit card offers compared on this page are chosen from a range of credit cards CreditCardFinder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.