Analysing your CIBIL score can be beneficial to understanding the financial health of your business.
Analysing your CIBIL score can be beneficial to understanding the financial health of your business. Here are some things you can do to improve your CIBIL score. CIBIL scores are a measure of your credit history and can have an impact on approvals. Fortunately, improving your score is possible through some simple steps. We’ve put together this comprehensive guide to help you evaluate your credit report, look out for errors & improve your score. Especially, credit cards for students.
Tips to improve the CIBIL score:
Set Reminders to Repay on Time
You can set reminders to avoid paying late fees. It is advisable to follow these reminders so that you stay on top of your finances. It's important to keep a tab of your bills conveniently in one place. The Slice app will notify you when it's time to pay the bill.
Do you still have questions about improving your credit score? You can reach out to your lending institution and find the best ways to improve it. The insights about your personal finance habits can help you make smarter financial decisions to improve your score and achieve your goals.
Check for Any Errors in Report
It's important to review your report for CIBIL score errors. Check with each of three credit bureau agencies - Equifax, Experian and TransUnion - at least once a year. Reflect on both the weaknesses and strengths of your report to make sure it is accurate. You might want to contest something that you think has errors in it, seems inaccurate, or is not compliant with the company's regular reporting practices.
Try Maintaining a Healthy Credit Mix
Having a healthy credit mix helps you maintain a good credit score. If you have too much of one type of credit, your score can drop or even become negative.
It may be helpful if you’re looking for a loan in the future. At the same time, it is also important to know more about the best credit card offers.
Clear Credit Card Balances Before Due Date
Many people forget to clear their credit card balance before the due date. This can lead to a lot of problems. Here are some of the consequences:
- late fees and interest charges
- low credit score
- higher insurance rates
- difficulty in securing a loan
- difficulty in securing a lease
- difficulty in securing employment, etc.
Say No to Being a Joint Account Holder
In the event that you and your spouse or partner are in a situation where one of you is not able to make decisions for themselves, it may be necessary for the other to become a joint account holder.
This means upon your death, your spouse or partner will have full access to all of your money.
If you don’t want this to happen, then it’s important that if one of you becomes incapacitated, the other should take over as an account holder instead.
Don’t Open Multiple Lines of Credit Too Fast
Getting a credit card is not always easy. You have to prove that you are responsible with your money, so most lenders will only give out one or two cards. But what if you are really in need of more lines of credit?
The best-case scenario is that the lender will offer you an increased limit on your new card with no fees attached. However, if they refuse your application because it looks like too much debt on your part, make sure to contact them about it before. A person should not open multiple lines of credit too fast. This is because the credit score will be affected and it may also lead to debt.
Limit Your Credit Utilization
Credit utilization is the ratio of credit card debt to available credit.
If you use your credit card to make purchases and do not pay off the balance in full, then your credit utilization ratio is the percentage of your available credit that you are using.
The lower this number, the better. A good guideline is to keep your overall credit utilization below 30%. This will help you maintain a healthy score and avoid running into any problems with lenders.
Get a secured card:
The first step is to choose a secured card. These cards are issued by banks and can be used at ATMs, gas stations, grocery stores, and department stores. For example, discover the best credit card offers on a secured credit card that starts with a $200 credit limit. This card has an annual fee of $35 and the APR is 17.99%.
Secured cards are not for everyone because they have some drawbacks. They don’t have rewards programs or cashback offers like other types of cards do. Secured cards also require you to put down a deposit that will be the maximum amount of credit you can use on your card before paying off your balance each month.
Following are the tips that one can keep in mind to improve their CIBIL score. Be sure to stick to all the bills to avoid inconvenience.