Improving Credit Card Eligibility: A 5-Step Action Plan for Beginners

A Credit Card serves as your best companion for paying bills, purchasing items online, and even building a good credit history. However, not everyone gets a Credit Card immediately. Banks have a few factors that they carefully examine before issuing your Credit Card. Hence, meeting the Credit Card eligibility criteria is the first step in securing a card.

A 5-Step action plan for improving Credit Card Eligibility

Step 1: Maintain a good credit score

A credit score is a three-digit number, and it gives banks an idea of how good you are at managing loans and payments. Nowadays, it is one of the most imperative criteria for Credit Card eligibility. In India, a credit score usually ranges from 300 to 900, and a score above 750 is considered excellent.

How to improve your credit score:

• Make sure to pay your loan EMIs and bills on time.
• Always avoid missing or delaying payments.
• Keep your old credit accounts active to show a long credit history.

If you never borrowed a loan or used a Credit Card before, then probably you don’t have a credit score.

Step 2: Keep a stable income and job

Banks prefer providing Credit Cards to those who have a steady source of income. Your income serves as proof that you can return the money borrowed.

How to show stable income:

• Always maintain salary slips and bank statements as proof of income.
• If you are self-employed, keep income tax returns and business records up to date.
• Stay in your job for at least 6 months before applying.

Some banks will even issue Credit Cards to freelancers and small business owners; however, extra documents such as tax returns and profit statements will be required in some cases.

Step 3: Reduce your debt

If you already have any loans or even debts, a bank will measure the amount from your income that you will be paying. Even if too much of your salary is being drawn out to repay EMIs, securing Credit Cards may be difficult.

How to reduce debt:

• Pay off the small loans in advance to free up income.
• Attempt not to take multiple loans at the same time.
• Keep your utilisation low (use only 30-40% of the credit limit).

Step 4: Choose the right Credit Card

Different banks may have different types of Credit Card eligibility based on income, spending habits, and lifestyle needs. Your chances of getting approved can be raised by leaps and bounds if you select a card that fits your profile.

How to choose the correct card:

• If you are just beginning your career, apply for an entry-level card with a low salary.
• If your lifestyle requires a lot of travel, get a travel Rewards Card.
• Purchase a reward or Cashback Card if you like to shop.

Customers who already have a savings or payroll account with a certain bank may also be eligible for pre-approved Credit Cards.

Step 5: Apply smartly and correctly

Applying for several Credit Cards at once can hurt a person’s Credit Card eligibility. Banks review your Credit Record every time you apply and submitting too many applications in a short period can make you appear eager for credit.

How to use it correctly:

• Always be sure you meet the requirements before applying.
• Only submit one card application at a time.
• Verify that all of the information you enter on the application form is accurate.

Final thoughts

It’s easy to increase your Credit Card eligibility if you do the right things. Use your Credit Card wisely, pay your bills on time, and enjoy financial freedom!