What Is Decline Code 51?

Decline code 51 usually means insufficient funds but can mean many other things. You should know your credit or balance before using your card. See more about decline codes.

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What Does Decline Code 51 Mean?

When a credit card transaction is declined with Decline Code 51, it means that the issuer has refused the transaction because the cardholder has exceeded their credit limit. This can happen for a variety of reasons, but the core issue is that there is no longer enough available credit on the card to cover the requested purchase.

Credit cards typically come with a predefined credit limit, which is the maximum amount the cardholder can charge to the card. If a cardholder attempts to make a purchase that exceeds this limit, the card issuer will automatically decline the transaction, generating a Decline Code 51.

How Does a Credit Card Work?

To understand why Decline Code 51 happens, it’s helpful to first understand how a credit card functions. A credit card is a form of revolving credit, meaning you can borrow money up to a specific limit. Unlike a debit card, which draws from your bank account, a credit card allows you to make purchases on credit, and then pay off the balance over time (with interest if the balance is not paid off in full by the due date).

The credit limit is determined by the card issuer based on factors such as the cardholder’s creditworthiness, income, and credit history. Each time a purchase is made, the available credit decreases by the amount spent. Payments made to the credit card account increase the available credit.

For example, if a cardholder has a credit limit of $1,000 and they have spent $800, they have $200 in available credit. If they attempt to make a purchase of $300, the transaction will be declined because it exceeds the available credit, and the system will generate Decline Code 51.

Causes of Decline Code 51

There are several reasons why a cardholder might encounter a Decline Code 51. Let’s look at the main causes:

1. Exceeded Credit Limit: This is the most common cause. As mentioned earlier, if a cardholder has already spent up to or beyond their credit limit, the transaction will be declined. The credit card issuer may allow the cardholder to exceed the limit in some cases, but it often triggers fees and penalties.
2. Pending Transactions: Sometimes, the available credit may appear sufficient, but there are pending transactions that have not yet been processed. These pending charges reduce the amount of available credit without being reflected in the current balance. This can lead to an unexpected Decline Code 51 if the cardholder tries to make another purchase.
3. Credit Limit Decrease: If the card issuer reduces the cardholder’s credit limit (due to late payments, a change in creditworthiness, or other factors), the available credit may be lower than anticipated. A previously approved transaction could be declined if the new limit is insufficient to cover it.
4. Temporary Holds or Authorizations: Some purchases, especially in cases of hotel bookings or car rentals, may place a temporary hold on funds. These holds reduce the available balance without actually being charged to the card. If the hold amount is too high, it could prevent other transactions from being approved.
5. Transaction Errors or System Glitches: On rare occasions, a system error or glitch may mistakenly report an exceeded credit limit when the available balance is actually sufficient. This may happen due to data transmission errors or glitches in the card issuer’s system.
6. Fraud Prevention Measures: In some cases, a credit card issuer may decline a transaction as a precautionary measure due to suspicious activity or patterns that suggest fraudulent behavior, even if the credit limit is not exceeded. This is more common in cases of unexpected or high-value transactions.

What Happens When Decline Code 51 Occurs?

For cardholders, a Decline Code 51 means that the purchase cannot be completed. Depending on the merchant and payment method, you might receive a message saying "Transaction Declined" or "Insufficient Funds." In some cases, the system may explicitly display the decline code (51), but often it’s just shown as a generic error message.

Once Decline Code 51 is encountered, the transaction will not proceed, and the merchant is notified that the payment has failed. The cardholder will be asked to use a different payment method or resolve the issue with their credit card issuer.

What Should Cardholders Do When Encountering Decline Code 51?

If you are a cardholder and you receive a Decline Code 51, here are the steps you should take:

1. Check Your Available Credit: Review your credit card statement or account balance to ensure that you have not exceeded your credit limit. If you have, consider making a payment to free up some available credit.
2. Account for Pending Transactions: Sometimes, pending transactions may reduce your available credit. If you have any recent purchases or reservations (e.g., hotel holds), check if they have cleared or if they are still pending.
3. Make a Payment: If you have exceeded your credit limit, make a payment to reduce the balance. Even partial payments can help restore your available credit, allowing you to make the purchase.
4. Contact Your Card Issuer: If you believe the transaction should not have been declined, or if you're unsure of the reason, contact your card issuer’s customer service. They can provide detailed information on the status of your account, including whether there were any issues with your credit limit or other account details.
5. Consider Increasing Your Credit Limit: If you frequently encounter this issue and need more available credit, consider requesting a credit limit increase from your issuer. However, keep in mind that a credit limit increase might affect your credit score depending on how it’s managed.

What Should Merchants Do When Decline Code 51 Occurs?

Merchants can also play a significant role in managing Decline Code 51 situations. Here are some actions a merchant can take:

1. Check for Errors: Ensure that all card details, such as the card number, expiration date, and CVV, are entered correctly. Sometimes, declines can occur due to simple input errors.
2. Offer Alternative Payment Methods: If a customer’s card is declined, offer them the option to use a different payment method, such as another card, a mobile wallet (e.g., Apple Pay or Google Pay), or even cash if possible.
3. Communicate with the Customer: Inform the customer that their payment has been declined and explain that they may want to check with their bank or credit card issuer about the status of their account. It’s important to handle the situation professionally and empathetically to maintain good customer relations.
4. Verify with the Payment Processor: If a Decline Code 51 occurs frequently with multiple customers, it may be a good idea to check with the payment processor to ensure there aren’t any issues with the payment gateway or fraud prevention systems.

Decline Code 51 is a common issue for credit card users, signaling that the credit card transaction could not be approved due to exceeding the available credit limit. While the most frequent cause is simply exceeding the credit limit, there are several other reasons why a transaction might be declined, including pending transactions, fraud protection measures, and system errors.

Cardholders should check their available credit, account for pending transactions, and contact their issuer if necessary. Merchants, on the other hand, should ensure accurate transaction processing and offer alternative payment options. By understanding what Decline Code 51 means and taking the appropriate steps, both consumers and merchants can effectively manage these declines and keep transactions moving smoothly.