What role does your cibil score play in obtaining a credit card?
Over time, credit cards have become more than just a symbol of prosperity. They have a big influence on a person’s credit score. By making purchases more convenient, credit cards help you save money. Your credit score will improve if you use your credit card responsibly. A good credit score enables you to take advantage of some of the most advantageous financial options available. Continue reading to find out how to get the most out of this valuable financial tool.
You can check your CIBIL score for free at any of the fintech platforms. If you are wondering about what is the full form of CIBIL, here it is- the CIBIL score full form is Credit Information Bureau (India) Limited.
What criteria do banks take into account while calculating your credit score?
Credit cards are unsecured loans, which means you don’t have to put up any collateral or security in order for the bank to lend credit to you. Because banks have no protection, they must be confident that the company they are lending to is creditworthy and will not default on payments.
They are able to do so because your credit score includes your entire bill-paying and credit history, from past loan repayments to cell phone charges.
A good credit score, as you might think, can help you be approved for a loan. However, the inverse is also true. It is therefore vital to have a decent credit score when applying for an instant credit card online.
How Can You Improve Your Credit Score?
If your CIBIL score is poor, you can quickly improve it by following these steps:
- Pay your existing credit card bills and loan dues on time to avoid any problems with your payment history and to create a strong credit score.
- Maintaining a credit usage rate of no more than 30%
- It is not a good idea to apply for many credit cards at the same time. Because every time you apply for a card, the provider conducts a hard query on your credit record, which reduces your score, this can hurt your credit score. As a result, the more questions there are, the more severe the consequences.
- Regularly reviewing your credit report to evaluate where you are and addressing any issues
Pro Tip – Your credit rating should not prevent you from obtaining a credit card.
In recent years, credit card users in India have increased at an exponential rate. The number of defaulters has risen over time as a result of various causes. Lenders are becoming more hesitant to provide credit cards to customers who have poor credit. It has the ability to stain one’s dream of building a strong financial profile and a positive credit history.
Getting a credit card can be difficult, but it’s not impossible. Begin with a low-cost secured credit card with a suitable credit limit. Because of this, your credit score will rise. A secured credit card is backed up by a savings account. The account is used as collateral by your credit card. Obtaining the card is less challenging. It can help you fast boost your credit score and take you closer to higher credit card offers if used appropriately.
The most crucial goal is to establish a solid credit history. It not only helps you build a strong financial profile, but it also helps you build a good credit score. Because no proof of income is required, obtaining a secured credit card is simple. If you get a secured credit card, make sure you keep it and pay it off on time to boost your credit score.
It is therefore recommended that you maintain a minimum CIBIL score of 750 in order to acquire better credit card offers and speedier approval. A CIBIL score is one of the requirements for obtaining a credit card. These factors will help you determine your credit eligibility when applying for best credit cards in India. To activate a credit card, however, no minimum credit score is required. You can either speak with a bank executive or apply online. The bank executive will check your CIBIL score, and the approval requirements will be conveyed. For your own confirmation, you can check your CIBIL score on any of the financial institution’s websites at regular intervals.