Credit cards have made everything better. They have improved our shopping experiences, they have made bill payment easier, and they have opened a whole new world of rewards and discounts for us to enjoy.
With more and more people looking to apply for credit cards, different banking institutions and credit card issuers are coming up with unique products – each with a different set of credit card eligibility criteria. While these criteria vary from bank to bank, the basic requirements remain the same.
And if you are thinking about getting your hands on a credit card anytime soon, here are the 5 factors that can impact your credit card eligibility:
This is the most important factor that can either make or break your credit card application. For most credit card issuers, this is a non-negotiable eligibility criterion, without which they won’t even entertain your application. For example, in order to apply for the Bajaj Finserv RBL Bank SuperCard, you must have a credit card score that’s 750 or above.
There are a number of things that you can do to maintain a good credit score such as paying all your outstanding EMI’s and debts on time, not applying for multiple credit cards simultaneously, making sure that your credit card bills are paid well within the due date, etc.
Another important factor that most credit card issuers emphasize is the existing indebtedness of the applicant. For this purpose, they also take into consideration your credit utilization ratio. It is recommended that you maintain a CUR of 30% or less. This improves the chances of getting approval significantly.
The applicant’s employment status also plays a big role in determining his/her credit card eligibility. If you are in long-term employment for over a year, it will boost your credibility to a great extent.
Irrespective of whether you are a salaried employee or self-employed business owner, the stability and regularity of your income is integral for the approval of your credit card application. Credit card issuers often have minimum income criteria that an applicant must fulfil otherwise the application is rejected forthwith.
To prove that you have a fixed income, either monthly or annual, you might have to submit proof of income, your bank account statements etc. Once you have established that you have a stable income in place, getting your credit card application approved will become a lot easier and a lot quicker.
Now, this factor is something that most people end up ignoring until it is too late. Also known as the length of your credit history, this essentially indicates the amount of time that you’ve been actively using credit cards. This takes into account things such as the duration for which you’ve had your oldest bank account, and if you have multiple accounts, the average age of them combined.
While having a long credit history is certainly helpful, if you have a history of non-repayment or delayed payment of your credit card bills, it can end up having a completely opposite effect. On the other hand, a shorter credit history made up of timely payments and fewer debts can also work in your favor.
Apart from the factors mentioned above, a few other things that banks assess are the location of your permanent address, your nationality (only Indian nationals and Non-Resident Indians or NRIs can hold Indian credit cards), and age. For instance, only individuals between the ages 21-70 years can apply for the Bajaj Finserv RBL Bank SuperCard and most other credit cards available in the market today. Applying for a credit card can be an overwhelming task – especially if you are unaware of the factors that can affect your credit card eligibility. But now that you know all about the factors that are taken into consideration by the credit card issuers, you can start building your eligibility, bit by bit, by making sure that everything is in place before applying!