Closing a Credit Card? Your EMIs Don't Disappear

Cancelling a credit card with ongoing EMIs doesn't erase what you owe. Banks charge foreclosure fees, may accelerate full repayment, and your credit score can take a hit. Here's what to check before you close.

Here's what happened: Closing a credit card with outstanding EMIs does not cancel the repayment obligation — dues continue under the same or a revised repayment schedule set by the bank.. Banks typically levy a foreclosure charge of 3–5% on the principal outstanding if a cardholder wants to pay off all EMIs in one lump sum before closure.. A card closed with unresolved dues can trigger a negative remark on your CIBIL report, reducing your credit score and shrinking your available credit mix..

What you should do: Call your bank's credit card helpline and request a written foreclosure statement showing the exact outstanding principal, interest accrued, and closure fees before initiating any card cancellation.. Check whether continuing your EMI schedule — rather than foreclosing — saves money, since the foreclosure fee (3–5%) may exceed any interest you'd save by closing early.. After full settlement, download your updated CIBIL report within 45 days to confirm the card account is marked 'Closed' and the outstanding balance shows zero..

Ask the bank for a 'No Dues Certificate' in writing after card closure — without this document, future disputes about lingering charges become nearly impossible to resolve.