What Happens to Automatic Payments When Your Debit or Credit Card Is Replaced?
Getting a replacement debit or credit card does not necessarily mean every automatic payment tied to the old card will stop working.
What happens usually depends on three things:
Whether the card number changed
Whether the merchant receives updated card information automatically
Whether the payment is actually tied to the card or directly to your checking account
Why Some Automatic Payments Keep Working
Visa, Mastercard, and other card networks operate account updater services that can provide participating merchants with updated card information.
If a card expires or is replaced, a merchant that participates in one of these services may receive the new expiration date or card number automatically. That can allow recurring payments to continue without requiring you to log in and update the card manually.
Not every merchant participates, so automatic updating is not guaranteed.
Does It Matter Why the Card Was Replaced?
The reason the card was replaced can affect whether the card number changes, and whether the card number changes does matter.
If a card simply expires or is damaged, the replacement usually keeps the same number while receiving a new expiration date and security code.
A card that was lost, stolen, or compromised will generally be issued with a new number.
The more information that changes, the greater the chance that at least some recurring payments will need to be updated manually.
Which Automatic Payments May Need to Be Updated?
Common examples of recurring payments that may be affected include:
Streaming subscriptions
·Gym memberships
Cell phone or internet bills
Insurance premiums
Subscription boxes
Software or app subscriptions
Other merchants that keep your card on file
Even if some of these payments update automatically, it is still worth reviewing them after receiving a replacement card.
For important recurring bills, linking the payment directly to your checking account or using your financial institution’s bill-pay service can reduce the chance that a replacement debit card interrupts the payment.
Because these payments use your checking account information rather than the debit card number, they generally continue normally when a card expires or is replaced. You would generally only need to update the payment information if your checking account information changed.
A failed subscription may only be inconvenient, while a failed insurance, utility, or loan payment could result in a late fee, interruption in service, or another problem.
What Should You Do After Receiving a Replacement Debit or Credit Card?
Start by activating the new card and reviewing any recurring payments you know are charged directly to the old one.
For important bills, it may be safer to log in and update the stored payment method yourself.
It can also help to review recent card statements for recurring charges you may have forgotten about. Subscriptions that bill quarterly or annually are especially easy to miss.
Over the next billing cycle, keep an eye on automatic payments to make sure expected charges continue to process normally.
What If an Automatic Payment Fails?
If a recurring payment is declined after your card is replaced, check whether the merchant still has the old card information on file.
Updating the stored payment method may solve the problem immediately.
If the new card information is already correct and the payment is still failing, contact the merchant first to find out why the charge was declined. If necessary, contact your card issuer to confirm that the replacement card is active and functioning properly.
Card Replacement Can Be a Good Opportunity to Review Your Recurring Payments
If you need to replace a card that was lost, stolen, or expired and you’re going to be reviewing and updating your payment information anyway, you may want to take the time to assess the value of all your recurring expenses. Streaming services, apps, memberships, and other automatic payments can be easy to forget once they are set up.
You may decide that, instead of updating card information, you’d rather cancel some of the subscriptions you no longer want or need.
Ouachita Valley Federal Credit Union members with questions about a debit card or replacement credit card, recurring payment, or account activity can contact us at 318.387.4592 for assistance.
