Why Do Credit Cards Have Expiration Dates?

 


A credit card is the most convenient source of financial tools. Credit cards provide a line of credit to their users and they can use it however they want; the plus point is that spending on a credit card lets you earn rewards and benefits alongside and also shower you with amazing deals and discounts. Also, you can apply for a credit card from the comfort of your home, via online means or you can just visit the bank if you prefer to physically go and apply. However, a credit card has an expiration date mentioned on it. A fixed period indicates when a credit card must be changed. Usually, a month and a year are used to signify the expiry time.


There are various explanations for why credit cards have expiration dates, including:


Gradual wear and tear:

Although credit cards are typically fairly durable, cards may begin to exhibit signs of damage after so many months or years of using them. They might get broken or damaged, the microchip might deteriorate, or perhaps the chip might stop working. Credit card firms will give customers a brand-new card before their current one expires in an attempt to keep it in good functioning shape.


Protects against fraud:

The expiry date upon the credit card serves as an additional safeguard to prevent illegal use. Card expiry date serves as an extra step that the sites utilizes to make sure that the provided data are accurate when completing a transaction when there is no tangible card present, including when making an internet purchase. For a payment to be accepted, the card number, expiry date, and CVV must all be entered accurately. Therefore, it does not matter if a fraudster gets your card information, he would be unable to successfully complete a transaction without the precise CVV and credit card expiry date.


Get a newer version of the card:

With time new designs change, and this involves issuing layers of new protection, including EMV chip innovation, to their consumers' cards. Additionally, a lender or credit card provider might mail cards featuring their fresh official logo if the company decides to rebrand.


Improved technology:

Currently, technology has a significant impact on the banking sector. Every once in a while, updates for credit cards are released. The new innovation is made available to all after the old card expires and is replaced. There may occasionally be a release of a forced update that compels institutions to immediately update your cards and deliver a new card to your home, even though the old card hasn't yet run out of validity.


Bottom Line:

There are various factors why credit cards include expiry dates. One would be to make room for the actual card's natural wear and tear. Both the plastic as well as the microchip upon that card have a chance of breaking. Preventing fraud is yet another important factor. The expiry date offers an extra piece of detail which may be examined to verify that the cards details are accurate and confirm that you are actually the authorized customer.


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