Nayan

A credit score is a crucial factor that is reviewed when you apply for a credit card or for a loan. It is a 3 digit number that determines your credibility. Here are some major factors that can affect your CIBIL Score that you must be aware of. Keep reading to kick start your research. Not paying credit card bills on time: It is crucial to pay the credit card bills on time and in full. If you keep defaulting in the repayment cycles then it will affect your credit score negatively. To avoid this from happening you can choose to register for the auto-debit services and you do not have to worry about remembering the due dates.  The high credit utilization ratio: Another important aspect that you need to keep in mind is not using your credit limit completely. It is advisable to maintain a credit utilization ratio between 30% - 40%, more than this will eventually harm your credit score. To avoid this situation you can set a threshold limit on your credit card so that on reaching that lim

For balance use of your credit card, you should use a maximum of 30% of your total available credit. Using more than 10% of the credit will make you lose some of your credit scores but 30% or more usage will definitely make you lose a lot. Generally, it is best to use less available credit because if you use a large amount of available credit then you will have difficulty repaying the debts. Credit Utilization Ratio The Credit utilization ratio is the amount of revolving credit you are currently using to the total amount of credit available to you. In simple words, it is the amount you have to repay divided by your credit limit. It is also termed the credit utilization rate. For Example, if your available credit is ₹ 20,000 on your credit cards, and the balance remaining on your credit card is ₹10,000 it means your credit utilization ratio is 50% as you have used half of your credit available. There are tons of factors that help us to determine the right utilization rate. These factor