CIBIL score or credit score is a 3-digit number that says about the creditworthiness of the lender. It is very important when you are in need of a loan as it determines whether the borrower will be able to pay back the loan or not.
Here is how a credit card can be used to improve the CIBIL score:
1. Make a purchase using cash
If you are in the habit of paying via the credit card, it will affect the CIBIL score significantly if there are no timely payments.
Do not increase the credit card debt.
If you no longer are able to pay off monthly expenses and repay the credit card, you will have to then reach out to the lender for a loan, for which, your application might get rejected.
Therefore, it is advisable to use cash instead so that the budget is maintained.
With this example, it is advisable to create a proper budget and use cash instead of a credit card.
2. Use the card to pay regular bills
Use the credit card to pay regular bills like the internet, phone, electricity, etc. This will help in building a positive credit history and help maintain a good CIBIL score.
3. Make repayment a regular habit
If you have a huge credit card debt to pay off, repay it at a minimum amount per month.
This will have a good impression on the lenders and make them believe that you will pay the loan on time.
4. Spend wisely
Keep track on your spending. This will make it easier for you to maintain the debts and maintain a good CIBIL score.
If you want to take a loan up to 10 lakhs for your business, contact Gromor Finance!