Why can't I get a credit card? 13 possible reasons + how to improve your chances for next time
Find out why you’ve been declined and uncover tips for your next application.
03.09.24
Beth
You’re not alone. According to the Money and Pensions Service (MaPS), roughly 1 in 5 adults (19%) had a credit application turned down between April 2022 and April 2023.
Even though it’s a common occurrence, it can be tricky to find out why you’ve been rejected. While you can always ask the credit card company to explain, they don’t have to tell you. So, it’s not unusual to find yourself in the dark when your application falls flat.
That’s why we’re here to shed some light on the situation. Let’s explore the reasons why a credit card application might be unsuccessful and find out how to improve your chances for next time.
13 reasons why a credit card application is declined
Typically, credit card applications are denied because of an issue involving one or more of these broad categories:
Your eligibility.
Your credit history.
Your financial situation.
Your application.
Let’s dig into each of these in a little more detail.
Eligibility reasons why your credit card application was declined
1. You’re not currently eligible
The simplest explanation is that you don’t currently qualify for the card in question. There are two minimum requirements to apply for a credit card in the UK. You need to be:
Over the age of 18.
A legal resident in the United Kingdom.
If you don’t meet both of these conditions, you won’t be eligible, and your application will be denied.
Even if you’re over 18 and a UK resident, it doesn’t mean you’ll automatically qualify for a credit card. Credit card companies set their own eligibility rules, and some providers require applicants to be 21 or over.
Lenders want to see how you manage money and if you can make repayments on time. If you don’t have any credit agreements in your name (for example, a phone contract where you pay for the handset and usage each month), it can be trickier to prove you can pay back what you borrow.
2. Your credit history is limited
If you’ve never taken out credit before (or you’ve only done so occasionally), you won’t have much of a credit history. As a result, some card providers might find it difficult to judge whether you’re a reliable borrower, which could increase the chances of your application being rejected.
This can often be why it’s harder for younger people to get credit.
3. Your credit utilisation is too high
When credit card companies review your application, they want to see how much credit you’re currently using. This is often called ‘credit utilisation’.
If a lender thinks your credit utilisation is too high in relation to your income, they might take it as a sign that you’re struggling financially. As a result, they may see you as a risk and decline your application.
Keeping your credit utilisation at around 30–40% reflects an appetite for credit and helps show you can maintain credit well, without relying on it excessively.
4. You’ve made too many credit applications in a short space of time
When you apply for a new credit card, the provider will do a ‘hard search’ of your credit report to check your credit repayment history, address history, public court records, Electoral Roll, and financial associations (someone you have a joint credit agreement with, like a spouse, partner, or family member — more on that below).
Each hard search leaves a footprint on your record that other lenders can see. Because the outcome of the application is not reported, too many hard searches close together could make it seem like you urgently need credit, you’re financially overstretched, or you’ve been rejected lots of times (all things lenders tend to be wary of and try to avoid).
5. You have late or missed payments
Your credit score measures the likelihood of you being accepted by a lender for a credit agreement, such as a mortgage or credit card. If you have missed or late payments on your credit file, it will negatively impact your credit score and increase the chances of your application being declined, as it suggests you’ve had trouble keeping up with repayments in the past.
6. You’re linked to someone with a poor credit history
Whenever you open a joint account or apply for joint finance with another individual, a financial association is recorded on your credit report. If that person has a poor credit rating due to late payments, defaults, or bankruptcies, it could damage your chances of approval.
7. You have an insolvency or CCJ on your credit record
Insolvencies like bankruptcies and IVAs and County Court Judgments (CCJs) are severe negative entries that damage your credit score.
They stay on your record for six years — even if the debt is settled — and make you appear very risky to prospective lenders because they show you have previously been unable to keep up with your repayments. There are also restrictions on some insolvencies regarding taking out new credit.
8. If your income is too low
If you can’t afford to repay what you’re looking to borrow, you may not be eligible for a credit card.
9. Your work history is unstable
Credit card companies look for stability in their applicants. They want to know you have a steady income so you can make your repayments on time each month.
With that in mind, they could decline your application if you have a patchy work history with lots of time spent out of work or moving between jobs.
10. You’re a student
Why is it hard to get a credit card as a student? While some lenders offer dedicated student credit cards with more flexible terms, others avoid lending to college or university students because they don't generally have a regular income or a strong credit history.
Related: Does your student loan affect credit score?
Application issues
11. You’re not on the Electoral Roll
Credit card providers need to check you are who you say you are before they approve your application. To do this, they’ll verify your name and address using the Electoral Roll.
If you’re not registered to vote in the UK, your name won’t appear on the Electoral Roll. As a result, the lender may find it more difficult to confirm your identity, and that could cause them to decline your application.
12. Your credit report contains errors
It’s easy to assume your credit report is an accurate reflection of your credit history. However, errors can sometimes slip through the cracks. An incorrectly recorded missed payment or a misspelling of your name or address could cause your credit card application to be delayed or even declined.
That’s why it’s vital to check your credit report before applying for credit.
13. You’ve made a mistake on the application form
Finally, you could meet all the eligibility criteria, have a strong credit history and a steady income, and still find yourself rejected for a credit card. If this happens, it’s a good idea to double-check your application for mistakes.
Even a small typo could set you back if the information you’ve submitted doesn’t match the details in your credit report.
Will a rejected credit card application harm your credit score?
This depends on the stage of the application and the number of times you’ve applied.
Eligibility Check: If you do an ‘eligibility check’ with a credit card provider to see if you qualify for the card, they’ll usually do a ‘soft credit search’ to help make their decision. If you’re rejected at this point, it will have zero impact on your credit score.
A Single Credit Card Application: When you submit a full credit card application, the provider will most likely do a ‘hard search’ of your credit file to see if they’d be happy to lend to you. Each hard check is recorded on your credit report, and the lender searching it will be able to see if you’ve already applied for other credit recently. If you’re rejected after one credit card application, it’s unlikely to have a major effect on your credit score.
Several Credit Card Applications: If you make several full credit card applications in a short period, it could impact your score negatively, this is because lenders will view it as an increased risk. It might look like you’re in urgent need of credit and/or you’ve been rejected many times. Or you could have taken on a lot of credit recently, meaning they wouldn’t be able to accurately assess your affordability.
How long should I wait to apply for a credit card after being denied?
It’s important to figure out why you’ve been declined. If it’s just down to a typo in your details, that could be a quick fix. But if there’s an issue on your credit report, some lenders recommend waiting around six months before applying again to limit any further impact on your credit score.
Next time: How to get credit if you can’t get approved for a credit card
If credit card rejection is a recurring problem, it’s time to take a step back and assess the situation.
Check the following before you apply again:
Register to vote: Once you’re on the Electoral Roll, it’s easier for lenders to verify your name and address, which improves your chances of being approved. If you haven’t already, you can register to vote online — it only takes around five minutes. Once registered, the info can take 1–3 months to appear on your credit report.
Make your payments on time: One of the best ways to enhance your credit score is to be consistent with your payments over a long period. Knowing when bills are due (and having enough money in your account to pay them) can increase your score over time.
Close any unused credit accounts: Having credit accounts open that you don’t use shows that you have available credit that is unused. Lenders have to take into consideration that you could use all your available limits when assessing affordability. It may help to close any old accounts that you’re no longer using, but bear in mind that this may cause a temporary drop in your credit score because you’ll have less active account history reported.
Check your credit report for errors (and fix them): Even the slightest mistake in your credit report could drag your score down. Go through it carefully to ensure things like your current Electoral Roll listing is correct and you’re not showing as missing a payment that you’ve made. If you spot an error, contact the company in question and ask them to fix it.
Read more: How to improve your credit score
To recap:
A credit card rejection usually boils down to issues with your eligibility, credit history, financial situation, or the application itself.
While you can always ask the credit card provider to explain why they’ve declined you, they’re not legally obligated to tell you. So, you may need to turn detective and dig into the details to find the reason (or reasons) yourself.
Check in with your credit health
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