Boost Your Credit Score to get an Online Credit Card of Your Choice: Here’s how
From managing your utility bills to paying for your online purchases, credit cards help meet your financial needs conveniently and without any delays. In today’s digitised era, you can apply for an online credit card conveniently and enjoy a number of lucrative deals.
By using a credit card judiciously, you can benefit from discounts on travel booking or free access to airport lounges. Be it cashback or rewards, online credit cards offer it all! However, getting a credit card of your choice isn’t easy, especially if it is your first card.
Your credit score plays a crucial role here as it dictates whether or not you get the credit card you want. This is because the score helps the lender assess your creditworthiness, based on which you qualify for a card.
So, if you do not make the cut or have noticed a dip in your credit score, try these tips to boost your score and get the online credit card you want.
Keep a close check on your credit utilisation limit
Your credit utilisation ratio determines the percentage of credit you have availed against the total credit limit you have available. For example, if you have a total credit limit of ₹5 Lakhs and make purchases worth ₹75,000, your current credit utilisation ratio is 15%.
In this case, it is a healthy ratio as experts recommend that you utilise only up to 30% of your total credit limit. When you exceed this limit, it can lower your credit score. So, if you want to apply for an online credit card, ensure that you keep this ratio within limits.
Make all credit payments on time and in full
While availing credit facilities can help you sail through tough financial times, ensure you refrain from defaulting on your monthly repayment. It is crucial to clear off your dues on time, as this can affect your credit score.
One simple way to go about this is to set monthly reminders to repay on time. This way, you not only boost your score, but also can avoid paying high penalties. Another way is to plan your budget so that your repayments are taken care of first.
Prepay smaller debt obligations
With many lenders offering affordable prepayment facilities, it is ideal that you pay off your smaller debts. You can go for a part or full prepayment of your outstanding loan balance before the completion of the loan tenure.
One of the main benefits of prepayment is that you can be free of debts, which helps reduce your financial burden. Boosting your credit score is another significant advantage of prepaying smaller debts. As you clear your dues, your credit score increases, and you can get your preferred credit card.
Ensure not to apply for multiple online credit cards
Be aware that each time you apply for an online credit card, your credit score is impacted. So, it is crucial for you not to apply for multiple cards in one go. This may project you as an individual in dire need of credit.
Instead, choose the card you feel best works for you and apply for it once you qualify for it based on the issuer’s eligibility terms. Follow this principle for all credit facilities in order to protect your credit score from dipping.
Suggested Read: Top Five Credit Card in India
Opt for secured credit options to build your score
As a first-time credit card user, you can build your credit score with a secured credit card.
While this card works like a normal credit card, you avail it against collateral, which is usually a fixed deposit.
This is primarily to minimise the issuer’s risk and gives you a chance to prove your repayment discipline. By paying your bills on time, a secured card can boost your credit score. This way, you can apply for an online credit card of your choice over time.
Now that you know how to build a good credit score to get your ideal credit card, start working towards this goal. To see the top online credit card options all in one place, get the Bajaj Markets App.
This digital platform allows you to compare various financial products and apply for them hassle-free. Download the Bajaj Markets App from Google Play or the App Store and apply for an online credit card of your choice with ease!
Suggested Read: Credit Card Tips to Help Keep Costs Down