How to close a credit card in India, and what it does to your score

How do I close a credit card?

Pay everything you owe, then send a closure request through one of your bank's listed channels. The RBI's card directions for commercial banks, updated as on 1 October 2026, and its matching directions for NBFCs such as SBI Card, require issuers to offer several channels, and an issuer cannot insist that you send the request by post.

Before you ask, redeem your points and check for pending EMIs, add-on cards and charges still on the way. RBL Bank says it will not close a card while a Dial For Cash loan has a balance. SBI Card and Axis Bank both end add-on cards along with the primary card.

At HDFC Bank and RBL Bank the card is blocked as soon as you raise the request. HDFC's MITC, updated 29 October 2026, says a closed card cannot be reinstated, so be sure first.

From each bank's own document, read 31 October 2026. Not stated means we did not find it in that document, not that no rule exists. Ask the bank.

How long can the bank take, and what if it is late?

The bank must close the card within seven working days of your request, once all dues are paid. If it misses that, the RBI says it must pay you Rs 500 for each calendar day of delay until the account is closed, as long as nothing is outstanding on it.

If you still owe money, the bank must tell you how much when you ask, without waiting for the billing cycle to end. The days you take to clear those dues do not count toward the seven. The bank must then notify you of the closure at once and report it to the credit bureaus.

An example. You clear your dues and ask for closure. The seven working days run out, and the bank closes the account 6 calendar days after that. It owes you 6 x Rs 500 = Rs 3,000. If a bank does not pay, raise it with the bank first, then follow the complaint route to the Ombudsman.

Will I pay a fee to close my card or get my annual fee back?

We found two early-closure charges, at Kotak and on HDFC Pixel cards, and a fee already charged often stays charged: SBI Card and Axis Bank give no pro rata refund of annual, joining or renewal fees, and Canara Bank refunds no fees on termination. A running EMI can also cost you. Axis charges foreclosure fees with GST on EMIs that closing ends, ICICI's MITC charges up to 3% of the principal outstanding on an instalment facility prepaid or terminated before its tenure, and Kotak's terms carry prepayment charges, so ask your bank what closing does to yours.

Kotak charges Rs 170 if a Dream Different card is cancelled within 90 days of issue, effective 1 September 2026. HDFC's MITC says the Pixel joining fee will be charged if the card is closed within 90 days of issuance, whatever the offer: Rs 1,000 plus GST on Pixel Times Rush, Rs 500 plus GST on Pixel Play and Pixel Times Move, and Rs 250 plus GST on Pixel Go. RBL says any refund is at its discretion. Its 45 day free look, in the table above, does not spell out the fee treatment, so ask RBL.

If a bank changes its charges against you, the RBI lets you surrender the card without any extra charge for closing, once your dues are paid. The bank must give at least one month's notice of such a change.

What happens to my reward points when I close the card?

At most banks we read, you lose them, so redeem before you ask: ICICI, Kotak and Canara cancel points on closure. HDFC gives you 30 days after closure, by a manual process limited to products and vouchers, with no cashback redemption on a closed card. SBI Card's MITC does not say, but its UPI SBI Card terms give 30 days after voluntary closure and forfeit points on any other cancellation, so ask SBI Card about other cards.

Axis Bank's document says two things. One passage forfeits unused rewards immediately after cancellation. Another, effective 1 October 2025, forfeits EDGE Reward Points and Miles 30 days after closure. Treat immediate loss as the safe assumption and ask Axis which applies.

A negative points balance can cost you money. Axis, Kotak and SBI Card's SimplyCLICK Advantage terms turn it into a charge on your account. Axis's example turns 1,000 negative points into Rs 200. See how to redeem points.

Does closing a credit card affect my credit score?

It can. CRIF, a credit bureau, says closing a card can lower your score by cutting your total limit and shortening your credit history. It gives no point figure in the two pages we read, and says the effect depends on your history, the card's age and your other accounts.

CRIF calls utilisation one of the biggest reasons closing a card can affect your score. Its example: two cards with a combined limit of Rs 2,00,000 and Rs 40,000 of use is 20%. Close a card with a Rs 1,00,000 limit and the same Rs 40,000 is 40%. CRIF says utilisation should ideally stay below 30%.

Age matters too. CRIF says closing your oldest card may shorten your average account age, while closing a new card may have no significant impact, and the effect might appear over the next one or two billing cycles.

The two TransUnion CIBIL FAQ pages we read on 31 October 2026 do not say what closing a card does to a score. HDFC reports unpaid charges on a closed card to the bureaus. See why a score can drop with no missed payment.

Will an unused card close on its own, even a lifetime free one?

Yes, if it goes unused for more than a year. The RBI says the bank must start closing it after telling you, and if you do not reply within 30 days, the account is closed once dues are paid. The bank then has 30 days to update the bureaus.

The RBI counts generating a statement, changing your PIN or changing transaction controls as use. A call to customer care for other reasons does not. ICICI needs your explicit consent to keep it, and looks at all cards on the account going unused for 12 months.

No annual fee does not change this: the rule covers a no fee card like Amazon Pay ICICI as well. HDFC also nullifies points on a card unused for more than 365 days. To keep an old lifetime free card, CRIF suggests using it occasionally and paying in full.

What happens to extra money on a closed card?

The bank must send it to your bank account. The RBI says any credit balance left after closure must be transferred to you, and the bank must ask for your account details if it does not have them.

Axis says a card closed with a credit balance is not reported to the bureaus as closed. On a secured card, Canara Bank closes the deposit only 7 days after the card closes. See cards against a fixed deposit.

Should I close a card with an annual fee, and how many cards should I keep?

Compare the value you get in a year with the fee. The RBI directions set no number of cards, and CRIF names no right number. CRIF's reasons to close include high fees, overspending, security worries and an issuer significantly changing the terms or rewards, and it suggests keeping your oldest card.

An example. A renewal fee of Rs 1,000 plus 18% GST is Rs 1,180. On a card that returns 1% of your spend, you need Rs 1,18,000 of spend a year to break even, about Rs 9,833 a month. At 2%, you need Rs 59,000 a year.

Fees are not refunded pro rata at SBI Card and Axis, so decide before the renewal fee is charged. CRIF also suggests considering a downgrade to a no fee version instead of closing. See how lifetime free cards work.

Do I get better offers if I close a card and apply again?

No document we read promises better offers or limits after a closure. Axis says the welcome benefit is available only once.

Axis says multiple applications can lead to multiple credit inquiries and may affect your score, and CRIF advises against applying for several cards or loans at once. To compare what is open now, use the card finder.