Kiplinger’s has posted a fascinating article about credit cards online. Included in this article:
Q: I hadn’t used my credit card for about a year when my bank canceled my account. Can a bank do that?
A: Afraid so. Even if your account is in good standing and you haven’t been late with a payment even once, an issuer has the right to rescind your card. Some have even closed
accounts on active customers because they incurred no fees or interest charges. "There’s no regulation that says you must continue doing business with someone who’s not profitable," says David Medine, associate director of credit practices at the Federal Trade Commission.
Yikes! I have never heard of a bank closing a consumers credit card account but it does seem entirely possible. If this happens to you, your credit score could drop fairly dramatically. Especially, if the the card that is closed is the oldest on your credit report or one of only a few cards you have.
The moral to this story: Be sure to use all your credit cards at least once every few months.
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