How to Manage Credit Card Debt Without Hurting Your CIBIL Score

Credit card approval depends on various factors: income, age, spending pattern, credit score and others. When getting a credit card, CIBIL score plays a crucial role in ensuring your application is approved on the basis of your creditworthiness. While other factors are important, it often plays a decisive role in determining your credit limit.

Factors That Ensure a Good CIBIL Score for Credit Cards

A credit score represents your creditworthiness; it is a three-digit number ranging from 300 to 900. The higher your score, the more creditworthy you are, indicating that you have a favourable chance of obtaining credit.

The credit score calculated by the Credit Information Bureau (India) Limited is known as the CIBIL score. Here’s what the terms refer to:

All the credit scores provided by these bureaus are credible. However, most financial companies use the CIBIL score. 

Your creditworthiness depends on the factors listed below:

A good credit score is usually between 700 to 900, which helps credit card companies approve your credit card application quickly. Maintaining a strong credit score is considered a good practice even though not all institutions rely solely on the assessment of credit bureaus. A good CIBIL score can lead to higher credit limits, lower interest rates, and more.

Wondering how bureaus assess your score? This is the basic process:

• The four credit bureaus in India collect information from banks and financial institutions
• They assess your payment record and financial data to generate credit scores
• The credit card issuer evaluates the credit score provided by the credit bureaus
• On the basis of this evaluation, the issuer approves your application
• The better the score, the higher the chances of you getting approval

Focus on These Practices to Maintain a Good CIBIL Score

While using a credit card for purchases, there are certain practices to keep in mind to ensure a good credit score at all times. Some of the tips are listed below:

Applying these tips to maintain a good credit score can enhance your overall financial health.

Maintaining a Good Score Comes With Many Perks

A good credit score is indicative of you being a responsible borrower. It not only provides access to getting credit card approval but also unlocks financial benefits, such as:

1. Lower Interest Rates: A higher score leads to better interest rates on all credit products, such as a car loan, home loan and more
2. Higher Credit Limits: Responsible credit management may result in higher credit limits on your cards or higher loan amounts 
3. Better Rewards Programs: Those with a good credit score get access to premium credit cards with attractive rewards 
4. Access to Exclusive Offers: Cardholders with strong credit scores often receive exclusive promotions and offers 
5. Easier Loan Approval: A good credit score helps you to obtain personal loans, mortgages and more quickly and conveniently 

Maintaining a good credit score is essential for easy access to these benefits and opportunities. By prioritising your credit score, you gain access to credit cards and enhance your overall financial opportunities and security.

If you are looking for a card with an instant approval process, the One Credit Card can be a good choice. You can save more with a wide range of discounts on shopping, dining, upskilling, rental payments, etc.

You can use the powerful One Credit Card App to manage your savings more effectively and control all aspects of usage. In addition, you can earn 5X reward points on your top two spending categories every month while using this stylish metal credit card.  Apply online to enjoy these perks!