In the rare occasion that you need to cancel a card, whether debit card or credit card, due to some reason, all balances and dues are tallied before the card is completely canceled. In most instances, the bank would inform you to ensure that no refunds or standing instructions are active on the card so that you don’t face any ECS failure charges or the unnecessary hassle of resolving refund issues. 

In spite of all this, if a refund is initiated against a canceled card, one of the two outcomes is possible – 

  1. The refund will be redirected to the bank account linked to the card. This might be possible for debit cards but could be a bit tricky with credit cards as you don’t always have a bank account linked to it. 
  2. Or, the bank would decline the refund and send it back to the issuer. The issuer then contacts you, or you contact them, regarding the refund and send it to a different account. 

There is no need to panic as the advancement in digital banking allows you to get timely updates on any refunds or charges on your cards and you can take timely action on them.