Everything You Ever Wanted to Know about “Declines” But Were Afraid to Ask


Declined. For cardholders and merchants alike, never is it a word that’s met with a smile. Declined transactions are upsetting to customers and represent a potential loss of revenue for your business. Unfortunately, though, they do happen. We only fear what we don’t know, so if you have a clear understanding of what declines are and why they happen, you’ll be better prepared to handle declined transactions when they occur.

Let’s start by discussing approvals.

When a credit card is approved during a transaction, it means the customer’s issuing bank, has approved the card. Issuing banks will approve credit card transactions when the credit card number and expiry dates are valid, the customer has enough credit to cover the amount of the transaction, and the card has not been reported as stolen or compromised. However, keep in mind that approval is not a guarantee that the funds will be transferred to your account. There’s always a chance that a customer will request a chargeback at a later date.

Declines work the same way but in reverse. When a card is declined it means that the issuing bank has flagged it for a variety of issues: the card’s number or the expiry date is no longer valid, the customer doesn’t have enough credit to cover the transaction or the card has been reported as lost, stolen or compromised. In order to prevent criminals from “testing” cards, issuing banks don’t provide a specific reason as to why a card is declined. However, declines typically fall into one of these categories:


One of the most common kinds of declines, this is just a normal decline from an issuing bank. This usually means that the cardholder has insufficient funds or there’s been a restriction placed on their card.


If the credit card is past its expiry date, the bank won’t be able to process it. The customer will have to provide another form of payment (this kind of decline is also incredibly common, as credit card expiry dates tend to be an afterthought for many of us).


If you’ve entered a credit card number incorrectly, you’ll receive an “Invalid Card” error. This means that the system has done a MOD10 check (the checksum formula used to validate a variety of identification numbers) and it was unable to validate the card. In this case, you’ll need to re-enter the credit card information.


While this is technically a decline, there’s a chance the bank will still approve the transaction. The bank simply requires the merchant to call for authorization. If the bank approves the transaction, they’ll provide the merchant with an approval code.

Keep in mind that some credit cards — especially business and corporate cards — may have restrictions on the kinds of purchases that can be made using the card. Same goes for international transactions. A card issued in another country may have a restriction in place that prohibits from processing all international transactions.

In either case, the cardholder would have to call their bank so that they can unlock the card and approve the purchase.


If you receive this message, it means you should “pick up” the card if it’s physically present. This message typically occurs when a card has been taken out of circulation due to it being reported lost, stolen or compromised in some way. Cue: every scene in movies where the owner of a ritzy boutique or restaurant takes the credit card from the customer and cuts it up right in front of their eyes.

Here are a few other things to keep in mind when dealing with declines:

If you receive a “pick up card” error message, this could be a sign that the customer is trying to make a fraudulent purchase with a stolen credit card, so approach the situation with caution. It’s never worth compromising your safety just to get a card from a customer.

Unless you’re inputting credit card numbers manually and receive an “invalid card” error message, trying to process a card multiple times isn’t going to change it from a decline to an approved message. While the customer may request that you try it again, once a card has been declined, it’s declined. If the customer has any questions, they need to speak directly with their credit card company.