Using a credit card has a bad impact on CIBIL Score or not , many users will think about it. Any Misuse of a credit card definitely decreases your CIBIL Score and will make you ineligible for any credit facility in future. So use your credit card nicely and smartly. Keep reading this article to clear your doubts that using a credit card affects CIBIL Score or not.
What is a CIBIL Score? CIBIL score is a three digit number that falls in the range of 300 to 900. To get better deals on Credit cards and loans your score must be closer to 900. Majority of Financial Institutes prefer CIBIL Score of 750 and above. Effects of Credit Cards on CIBIL Score: Here are some major factors that can affect your CIBIL Score negatively:
Some financial institutes provide extra usage limits on the credit card beyond the maximum limit. Exceeding the maximum limit also decreases the CIBIL Score.
If your credit card application has been rejected, do not apply for credit immediately. First improve your CIBIL Score and then apply again. Bottom Line: Credit cards can have a major effect on your CIBIL score as they are the easiest credit facility available to a common man. Also these facilities can help you build a good credit score if used wisely and efficiently. Keeping a good credit score will always help in availing credit facilities with ease in the near future and will also represent a good debt to income Ratio. Additional Reading: Indusind Bank Legend Credit Card vs Pinnacle Credit Card
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