Negative Balance on a Credit Card: What Does It Mean?
8 Min Read | Published: May 23, 2025
This article contains general information and is not intended to provide information that is specific to American Express products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.
Learn what a negative balance on a credit card means and how it happens. Get tips for using extra money from your negative balance today.
At-A-Glance
- A negative credit card balance isn’t a bad thing. It can mean your card issuer owes you money.
- You might have a negative card balance if you overpaid your last balance, received a refund, or had credit card rewards applied to your credit account.
- You can use the extra money from your negative balance to decrease your next bill, spend less on your next purchase, or request a check, direct deposit, or money order refund.
Don’t panic if you’re seeing a negative balance on your credit card. Unlike a negative bank account balance, which means you owe the bank money, a negative balance on a credit card may indicate you have a credit surplus. You don’t have to worry about it negatively impacting your credit score either. Keep reading to uncover different ways to use your extra money.
What Is a Negative Balance On a Credit Card?
You may see a $0 balance after paying your monthly credit card bill in full, so a negative balance might feel concerning.1 But, unlike a negative bank account balance that signals debt, a negative credit card balance means your issuer owes you money, especially after you overpay in some way.2 You may see negative balances on your Credit Card from American Express® if your Card allows you to earn cash back rewards, and those rewards are credited to your statement.
Why Is My Credit Card Balance Negative?
While overpaying a credit card is a common reason for a negative balance, here are a few other potential reasons why you could be seeing a negative balance:
- Statement Credits
Rewards Cards come with perks like points, miles, and cash back. You may be able to apply those perks to your account balance, which can bring a low or $0 balance even lower into the negative.3 - Resolved Fraudulent Charges
In fraud cases, you may dispute a credit card charge that your issuer or a merchant later resolves, resulting in a charge reversal. If you already paid the amount, you might see a negative balance after receiving the funds owed to you.4 - Fee Cancellations
If your card issuer waived an annual fee, interest charge, or any other fee you already paid, you may see it credited to your account, placing your balance in the negative.5 - Balance Overpayment
Some card issuers let you pay more than your balance total each month, potentially making it easier to accidentally overpay and see a negative credit card balance.6 - Refunded Purchases
In cases of a refund on a credit card, you may have made a legitimate purchase and returned it to the merchant after paying your bill, creating a negative balance when the refund hits.7
What Can You Do With a Negative Credit Card Balance?
You can choose between three options when deciding how to take advantage of a negative credit card balance:8
- Keep the balance negative and see if you want to apply it to future purchases.
- Use the negative balance to decrease your next monthly bill or reallot the money as discretionary income.
- You can request a refund via check, direct deposit, or money order for negative balances as well.9
If you want to close your credit card account, consider requesting a refund or applying negative balances to purchases beforehand, as a negative balance might complicate a closure.10
Does a Negative Balance Impact Your Credit Score?
Negative credit card balances don’t affect your credit score since many credit scoring models interpret a negative balance as a $0 balance.11 But negative balances in isolation typically don’t improve credit scores either because they usually only decrease your credit utilization ratio in the short term.12
Frequently Asked Questions
While you can charge up to your limit plus whatever the negative balance is, you can’t raise your limit by overpaying.13 You can call your issuer or contact them on their app if you need to increase your limit, but this process may trigger a hard inquiry that temporarily affects your credit score.14
While you may not be able to transfer a negative credit card balance to your bank directly, you can ask your issuer to deposit the refund into your checking account.15 You might also receive a check with a refund, which you can then deposit into your checking account.16
Card issuers must issue a refund for a negative balance that’s over $1 within seven business days of receiving a written refund request.17
The Takeaway
Negative balances on your credit card might look alarming, but they usually mean you’re owed money, not the other way around. Whether you overpaid or received a refund a negative credit card balance doesn’t negatively impact your credit score. Using the extra money intentionally is a chance to practice mindful spending, so carefully consider keeping the balance to lower your next bill or use it for your next purchase.
1,2,15 “What is a negative balance on your credit card?,” Bankrate
3,4,5,6,7,13 “Can You Have a Negative Balance on a Credit Card?,” Experian
8,10,11,12,16 “Negative Balance On A Credit Card: What To Do?,” Forbes
9,17 “See a negative balance on your credit card? Here's what you can do about it,” CNBC
14 “How to increase your credit limit,” Bankrate
Liv Gillespie is a Philadelphia-based writer with a double M.A. in English Linguistics & Literature and Secondary Education. Her work focuses on personal finance.
All Credit Intel content is written by freelance authors and commissioned and paid for by American Express.
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