Citi is one of the leading consumer credit providers in the US market. They offer a wide variety of rewards cards ranging from student-specific cards to their new Citi Simplicity Rewards Card which features no late fees. The average US consumer carries 3 credit cards. With the wide variety of Citi offerings, it would not be uncommon for one to want to carry three different cards from this issuer. However, this is not possible.

Citi has a policy that each consumer may only carry a maximum of two of their credit cards. This fact is not very widely known by the US consumer. The problem arises because of decisions that many consumers have made in the past. Because credit card companies target college students, especially during their freshman orientation, many students receive a Citi card when they turn 18. These student cards typically have a higher APR than those cards available to older adults who have already established their credit. Still, most students carry these cards primarily because they are struggling for money and need credit for books, recreation, etc. even if this means paying a high APR. Five years later, the former student is enticed by another offer, let's say the Citi Platinum Select Card for example. They apply for this card because it offers a lower APR and higher credit limit.

Time goes on and the consumer has built-up their credit history by making timely payments etc. Now they are interested in a new offer that offers a rewards program, like the Citi Simplicity Rewards Card or the Citi PremierPass. They fill out the secure online application and are instantly rejected, even though they have very good credit. The reason why this occurs is because their social security number is on file in the Citi credit card system notifying that they already carry two other Citi credit cards.

Now there is a problem. It negatively affects the consumer's credit rating to cancel their student card which they've been carrying for years even though they are current on payments. Closing accounts is looked upon as negative credit activity. So, the only other option is to transfer the balance from the student card to another issuer, wait a few months, then re-apply for the Citi card that they originally wanted and transfering the balance from their new card onto that Citi card. This, however, is also a problem. If it appears on your credit report that you have been applying for several cards within a short timespan, especially when transfering balances, red flags go up.

The solution:
Catch this problem early on. If you are carrying a card with a high APR, like a student card, transfer that balance on to the card that you want. Then you are only carrying one Citi card and you may apply for another card and get approved in the future, assuming there is an offer that entices you.

The other option, which negatively affects your credit temporarily, is to cancel both cards simultaneously, wait for a while and then apply for the Citi card that you would like to carry.

Option #3 is only specific to those with no current, or one current Citi relationship. Choose your new Citi card wisely. Make sure that the Citi card that you wish to carry is one that you would like to have for the long haul.

Russ Nauta is the senior writer and consumer credit information investigator for Credit Card Outlet, a leading online credit card information portal since 2004

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