The fact that credit cards expire is a feature of the product that is clearly nothing but annoying and inconveniencing, not to mention bad for the environment. It can be especially frustrating if your card expires without you realizing it, resulting in recurring transactions getting declined. However, there are several reasons why credit card expiration dates exist, which this articles examines.

#1 – Fraud Prevention

You’ve likely noticed that many online vendors ask for your credit card’s expiration date when you’re making a purchase. Those making sales by mail or phone may do the same thing. The reason in all cases is that the card isn’t present during the transaction, meaning a vendor cannot check the card directly. By asking for the expiration date, the vendor can at least confirm that the card is likely with the cardholder. What’s more, expiration dates also prevent very old cards from being used to make purchases.

#2 – The Longevity Issue

The physical credit cards also won’t last forever. Frequent use of the cards takes a toll, given that they are getting swiped through machines potentially tens of thousands of times over the life of the card. This swiping causes wear and tear on the magnetic strip, as does constant removal and replacement into a wallet or purse. If your card has a chip, it’s possible that the chip could get knocked loose over time. Ultimately, a credit card is just a thin piece of plastic that’s likely to get damaged over time. Credit card expiration dates partially exist to ensure you always have a working credit card at your disposal. When you receive a new card every few years, you don’t have to worry about standard wear and tear causing issues with your transactions.

#3 – Marketing Opportunities for the Issuer

Credit card expiration dates don’t solely exist as gentle reminders to cardholders that they may need a replacement. They’re also reminders for credit card issuers that an opportunity is available to market new products to their existing customers. For example, an issuer may use an expiring credit card as an opportunity to discuss extending your credit limit or moving you onto a different card. At the very least, the expiration date acts as a signal to send a new card that has updated branding.

#4 – New Technology

In recent years, we’ve seen the rise of several technologies that alter how we use credit cards. Chip and PIN technology allows you to use your card and a PIN to make payments without handing the card over to another person. Contactless payment technology allows you to pay small sums without your card ever coming into contact with another person’s hands or a machine. These new technologies require alterations to your credit card. Therefore issuers often set credit card expiration dates as triggers for them to deliver cards with new and improved technology to consumers.

#5 – Reminding the User About the Card

Believe it or not, a lot of people apply for credit cards that they end up rarely using. Credit card expiration dates give issuers a reason to get in touch with you to offer a reminder that your credit card still exists. They’re often hoping that you will start using the card, providing them with an opportunity to collect interest in the process.

Expiration Dates Are Annoying But Serve a Purpose

Though credit card expiration dates can appear somewhat arbitrary, they do serve purposes both for the credit card issuer the customer. For the issuer, its mainly a marketing opportunity and an excuse to interact with a customer, but for consumer there are safety and functional reasons why expiration dates are needed.

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