How To Get Your Credit Card Application Approved: Tips & Tricks

If your credit card application has been recently declined, there might be a reason or two. It is important for applicants to analyse the likely reasons for rejection and make amends before applying the next time around. Do not feel dejected or lose hope. Generally, banks are not very likely to give you an explanation for the rejection.

Here are some tips to follow to ensure speedy and successful approval of your credit card application:

Take a look at your credit score: The first thing to do if you are applying for a credit card is to check if you have a good track record and a good credit score. Yes! You can have a credit score even without owning a credit card. Generally, people who do not have a credit card assume that they do not have a credit history and thus tend to be very careless with their finances. This is usually where the problem lies. Remember that there are several factors that determine how trustworthy you are as a borrower. This includes how you pay your bills, loans such as personal loans, car loans, etc. All this will reflect in your credit score before you even apply for a credit card! A poor payment history and track record will lead to rejection. So, mend these aspects before you send out the application.

What is a credit score?
A credit score is a three-digit number that acts as an indicator that will determine of reliable you are as a borrower. This is a very crucial factor that helps determine how much credit you will be eligible for in the future. It is also one of the main factors that will help you get your credit card application approved without any hassle. Ideally, a good credit score is a figure that hovers around the 700 mark.
How to improve your credit score:

• Do not make late bills payments
• Manage your debt in an effective manner
• Have a reasonable debt to income ratio
• Do not let debt get piled up
• If you already have a credit card and are planning to apply for a second one, use your credit card wisely

Make sure you are applying for a card you are eligible for: Another essential point to keep in mind is to apply for a card that you qualify for. There are many types of credit cards, and they come with different credit limits. You will be given an approval for a card based on your income level and track record. So, if your income is Rs.30,000 per month and the credit limit is Rs.50,000 per month on the card you have applied for, the card will not be granted. Most banks may not cite an income criterion, and therefore it is up to the customer to make that calculation and apply for a card accordingly.

Go, paperless: One of the most important things to keep in mind while sending out an application is the approach. If you submit a paper application form, it is likely for the application to go unnoticed or sometimes, even get misplaced. There is also the need to make an effort to go all the way to the bank. Why not explore the paperless method and submit your credit card application online? Use can also use an app to apply for a credit card.

Make sure you are paying bills: Be it your mobile bill or other types of utility bills, if you are not making bill payments on time or defaulting payments, it is very likely that your credit history is getting affected.

Do not default loan payments: If you already have any existing debts such as personal loans, education loans, home loans, car loans, etc., be disciplined enough to pay your EMIs on time without fail. Any default in this will have an adverse effect, and you will then be classified as an unreliable borrower. This is possibly one of the strongest reasons why banks reject credit card applications.

Also, here is a list of other factors that will affect your approval:

• If you have a relatively high loan balance
• If you have too many loans
• If you have a track record of loan default
• If you have missed a couple of EMI payments

Avoid making too many cold calls: The worst thing you can do is to apply for too many credit card at the same time. Especially if you have faced rejection in the recent past. It is important to first look into the causes of rejection before sending out a new/fresh credit card application. Also, if you already have more than one credit card, this will also have a negative impact.

Ask for reference: If you ask an existing customer to give you a reference, it might up your game and increase your chances of getting your application approved. So, keep this in mind, when you send out an application the next time around.

Check if your credit score is wrong
Sometimes, there may be some type of misrepresentation in identity, and your credit score may not be accurate. So, make sure you check if there is any discrepancy. How do you know this? Check and see if you have made late payments on bills or loans. If you have been disciplined with your payments and your credit score still does not look positive, there could be some type of misrepresentation in such a case.
Final words
Before sending out an application, know where you stand and do not blindly blame the bank. Make an effort to work on your shortcomings and the send out forms. Getting a credit card approval is a big step forward indeed and can give you a lot of financial freedom.

Top 5 Reward Credit Cards In India

Top Rewards Credit Cards  in India 2017

1.SimplySAVE Advantage SBI Card

This card comes stacked with benefits. Once the cardholder burns through Rs.2,000 in the initial 60 days, they get a reward of 2,000 reward focuses. Additionally, for each Rs.100 spent on feasting, staple, motion pictures, and departmental stores, the cardholder can gain 10x reward focuses. On each other use made on the card, they can gain 1 remunerate point for each Rs.100 spent on the card. Likewise, utilizing this card at any petroleum pump will get you opportunity from paying 1% fuel additional charge.

2.HDFC MoneyBack Credit Card

The cardholder earns 2 reward points on spending Rs.150 on this credit card. Also, they can earn 2x reward points while shopping online. Apart from this, the cardholder can bag a fuel surcharge waiver of up to Rs.500 on every billing cycle. This card also comes with zero liability if the cardholder ends up losing it.

3.American Express Membership Rewards Credit Card 

Easy to use and highly popular, this credit card is one of the most useful when it comes to gathering reward points. Cardholders can bag a welcome gift worth 4,000 bonus membership reward points. Also, they can earn 1 membership reward point for every Rs.50 spent on anything except for fuel, utilities, insurance, and cash transactions.

4.ICICI Instant Platinum Credit Card 

This card is for all those who love to have a good life. Cardholders can earn up to 2 reward points on every Rs.100 they spend on this card (except for expenditure on fuel). These reward points can be collected and redeemed for cash. Cardholders can also get a discount worth 15% on dining at more than 800 restaurants using the Culinary Treats Program.

5.Standard Chartered Platinum Rewards Credit Card 

This is another Mastercard that is profoundly mainstream among individuals who anticipate winning prize focuses. Cardholders can gain 5x remunerate focuses at presumed lodgings, eateries, and others in India and also, abroad. They can likewise acquire 1 remunerate point for each Rs.150 spent on each other classification. Cardholders can likewise sack 5x remunerates on purchasing fuel in India. 

On the off chance that picked admirably, a great prizes Visa can help the cardholder to win weighty rebates on shopping. All it needs is some fastidious picking. 

New to Credit Cards? Here’s All You Need to Know

So you’ve decided to take the plunge and get yourself a credit card. Unwrapping that shiny little piece of plastic opens you to a world of benefits and privileges. However, there are certain rules to live by if you want to avoid falling into a debt trap that could see your credit worthiness spiral downwards and make you a financial persona non grata.

A credit card gives you the freedom to spend money that is not debited from your bank account up to a certain sum for a fixed period of time. Thus, credit cards make credit available to you as and when you need it. The amount is to be repaid based on your billing cycle to avoid penalties and fines. While the initial rush of swiping your card everywhere you go might seem the way to go, here are some points to keep in mind so card debt does not loom on your financial horizon:

• Credit Card Charges:

A credit card usually comes with a whole list of Credit card charges, beginning with the joining fee. Additional charges include the annual fee, statement fees, service tax, surcharge, late payment fee, card replacement fee, etc. Exceeding your credit limit on your card will attract a charge as well. Delayed payment of your dues will also result in a penalty, which will be levied on your subsequent bill.

Not paying off the total amount due on your credit card will attract interest charges, which could be anywhere from 3%-4% a month. Doesn’t seem like much, you might scoff, but when annualised, the rate amounts to a whopping 48% on the higher end of the interest spectrum. This amount is also levied on each successive bill that has a balance carried over, which will inflate your overall amount due by a significant amount.

• Picking a Credit Card that Suits Your Needs:

Picking a credit card that suits your needs is important, as this could be the deal breaker between you enjoying the perks of a card and drowning in a sea of debt. If you’re looking for a card merely to help you keep up with payments and aren’t looking for any perks, a no-frills card is the best bet for you. Looking for discounts each time you swipe at a store? A shopping credit card that offers cashback or in-store rewards is the one for you. Frequent travellers can benefit from a travel card, which converts points into air miles redeemable on flights or hotel stays.

• Dates to Remember:

With your new credit card comes a host of important dates that you have to keep in mind, such as your bill payment date, the date the bill is generated etc. The date your bill is generated on marks the end of your billing cycle and lists your outstanding dues for that period only. The bill payment date is the date by which you are expected to pay off the outstanding amount or the minimum amount due to avoid late payment charges.

• Credit Card Application Status
  Different banks have different ways of credit card application status but most of them have an online facility, where you can apply for a credit card online as well. The process then involves furnishing all required documents and information to the bank. Once, the application process is complete, you must track your application status to check how far long has it been processed by the bank so that you can follow up with the bank accordingly. Usually, it takes up to three weeks to receive your credit card from most banks. Credit card may take a month from the date of registration, as it undergoes processing request, followed by dispatch to your home address.
  

• Minimum Due versus Full Payment:

Credit cards offer you the chance to pay off your debt in instalments, either before the due date or after it. It is always advisable to pay off your outstanding amount by the due date to keep your credit score and repayment history healthy. However, if you are unable to pay off the whole amount, you are required to pay a minimum amount, usually a percentage of your total outstanding amount.

Getting away with paying just the minimum amount brings with it a set of charges though, since you will be paying interest on the balance amount. You will also lose out on the interest-free period, meaning every successive transaction will incur interest from the day the purchase is charged to your card.

As seen above, there are quite a few pitfalls associated with credit cards that, if you aren’t careful to avoid, could leave you in debt for a considerable amount of time. Being prompt with payments, avoiding maxing out your credit card and being prudent with what you charge to your card will ensure that you reap the many benefits that come with credit cards.

Credit Card Bill Payment by Online Banking

To pay credit card bill by online banking follow the below steps

• Activate your online banking account which is secured with an IPIN.
• You can then login and view your credit card purchases, statements, payment dues dates and outstanding amounts.
• Select the credit card and click on “Pay credit card bill now”.
• You can then select the bank account to be used, enter the amount you wish to pay and make the payment.
• Online Banking is the fastest way to pay your bill as the turnaround time is usually immediately or on the same day.

Secured credit card for building credit

There is a very old saying that goes “It takes money to make money.” This means that you need credit for building credit. You must learn responsible credit management if you wish to rebuild your bad credit or have zero credit history so far. Using secured credit cards for building credit can definitely prove to be the right decision for you.

Secured Credit Card:

The credit score that you get is determined by the credit history that you build over a long time. If you have a very strong history of making payments, you will get a great credit score. Experts have recommended that one must start with secured credit cards. You get approval for these cards easily. The secured credit cards can serve as the perfect starting point for you when you want to build credit.

Almost anyone can get approval for secured credit cards. The regular credit cards are all unsecured and do not require collateral that can be recovered by the creditor. However, in case of secured credit cards, collateral is required. This particular safety net allows individuals with no credit or bad credit an opportunity to get approval.

If you wish to avail a secured credit card, you must deposit a particular amount in the card issuer’s account. This amount, in turn, becomes the limit that you can spend using your secured credit card. Some secured credit cards have low deposit requirements and some have high deposit requirements. Choose the one that suits your needs.

Secured Sbi credit cards can be used like other regular or unsecured cards. The credit card issuer will keep your deposited amount in its account and will use it to cover losses, if any. A debit card and a secured credit card work in the exactly same manner. As long as the credit card issuer sends reports to credit bureaus, you keep building your credit. The issuer must send the reports to bureaus like Experian and Equifax.

Building credit with the help of secured credit cards:

After you get the secured credit card, you must use it for building revolving credit. Lenders will realise that you can handle credit responsibly if you establish a good payment history. However, do not spend too much using your credit card. Ensure that you only spend what you can repay in full at the end of the billing cycle. Ideally, the credit card usage should be below 30% of the total limit on the card.

For example, you can refuel using your credit card every month. This amount will be easy for you to repay and you also build credit. Paying off the entire debt at one go helps you to avoid interest charges.

Practicing patience and remaining dedicated to the entire process of credit building can prove to be challenging. If you want to see some real progress in scores, you will have to build a perfect payment history for a substantial period of time. There is no quick fix or short cut when it comes to credit building.

You can plan on advancing in the world of credit after you have worked towards building credit for a period of 6 to 12 months by establishing great payment history. You can easily apply for a regular credit card, provided to continue to make due payments on time. Getting a car loan can also help you in the credit building process. An auto loan acts an instalment credit. So, when you pay the instalments on time, your credit score goes up.

Bottom Line:

Credit building is of utmost importance if you wish to avail loans from banks or other lenders. Credit score is the first thing that lenders would wish to see before approving your loan request. Ensure that you spend within your limits and pay off your debt on time.

Benefits of Balance Transfer Cards

Balance transfers are a term almost every cardholder comes across. Whether it be during the time of application, being advertised as a benefit or as a promotional offer being pushed their way. While some cardholders may be well versed with the term, first time cardholders might find this term vague and confusing. Balance transfers are a way of managing overdue credit card balances accrued on other bank credit cards by transferring them to a new credit card. Doing so would grant the cardholder the ability to pay off the balance in installments over specific tenures at interest rates that are much lower. As a result, it is a great way of clearing out dues before compounding interest rates spiral the debt out of control.

But a balance transfer plan can do much more than stem the debt from overflowing. Below are ways in which a balance transfer enabled credit card can help a cardholder.

• Opens up more room for cardholder’s money: The balance transfer plans can work for people who have debt that they can afford to pay off. Debt transferred onto balance transfer cards don’t accrue high rates of interest for the tenure chosen. This allows cardholders to make minimum monthly payments on the debt and gives them more room with their cash to spend on other expenses. The low rates of interest mean that even though minimum monthly payments are being made, the debt will still get serviced. The money freed up can be used on more productive avenues such as investments or deposits into a high yield savings account. One thing to note when using this strategy is that the balance of the debt should be cleared as soon as possible once the balance transfer tenure expires. Balance transfer plans revert to original interest rates when the tenure is up and failing to clear the balance will begin accruing interest at higher rates undoing all the benefits gained from the strategy in the first place.
• Other Benefits: Balance transfer cards also come with a slew of ancillary benefits that can help a cardholder financially. Benefits include complimentary travel insurance policies and rental car insurance policies. They help save the cardholder the added expense of purchasing these policies separately. The balance transfer cards also come with a credit dashboard. This dashboard allows cardholders to monitor their credit score with every payment that they make and is a very helpful tool for those who have debts and have missed a few payments in the past.
• Protect credit scores: Using a credit card bill payment, cardholders can ensure they repair some of the damage caused to their credit score when they accrued the loan in the first place. The cards allow cardholders to pay off the debt quicker and easier through lower interest rates and can bring up the affected credit rating of the cardholder.

Things to look out for:

• They should be opted for if they have low transfer fees. Some cards might charge upwards of 5% for transferring balances which can eat away the benefits of having lower interest rates.
• Ancillary benefits such as complimentary insurance policies are not comprehensive and do not cover a wide range of claims.

How credit score can impact your employment

The western economies have been considering a person’s credit profile before hiring. The companies consider a bad credit score as an irresponsible behaviour of an individual. The person’s inability to pay the bills on time shows that he is not capable of taking care of things. The companies run a credit check just like they would check for criminal history as it will affect the employer’s reputation as well.

Credit check has become a part of the background check which is done by the human resource team of the employers. A bad credit score is implied as bad intentions in general. If the applicant has ‘settled’ stated across the credit cards, then the HR tries to stay away from such candidates. It is also believed that the people in a high level of debt cannot work efficiently and therefore will not deliver the best results.

It can be argued that those who have been victims of identity theft and wrong entry in the credit report are wrongly judged. Even though this is true, the IT companies are also seen accessing the credit report while running a background check of a candidate. The list of sectors that will run a credit check keeps increasing. The best thing to do is to be aware of your credit score and thoroughly read your credit report.

It is important that you check your credit score and credit report once in a year at least. Access the credit score before you are applying for a job. Check for discrepancies and if you find any, report it to the credit bureau. Check if appropriate actions are taken with the bank and the credit bureau. This doesn’t end there, you need to follow up and see if the matter has been resolved. If this is the case, then you have a valid explanation and make sure that you bring it to the notice of the Human Resource of the company that you are applying at. This will help the Human Resource to take an informed decision rather than simply rejecting your application. 

Though the companies are referring to your credit score, it is not the only deciding factor for a person to get a job. If your credit score is good, then it is only going to improve the prospects of you landing a job that you prefer. A good credit score puts you in a good position. So, pay your loans on time and keep a tab on your credit score and fix it if they are bad. Keep an eye out for false and wrong credit information. IF you find discrepancies, report it to the bureau and take corrective measures and clear it out with the bank and the credit bureau. Follow up on your complaints and check if they have been resolved. 

Companies are now checking the Credit score and report to judge a person’s stability and efficiency. However, the reasoning is held against the victims of identity theft and if there was a wrong entry. But, then they can be resolved.

Reasons to access your credit report

We are always stressing about having a good credit history and a good CIBIL score when we are in need of a loan. Most often we think that it is enough if we have all the documents in place while applying for the loan. But that is not enough, we need to access your CIBIL report and CIBIL TransUnion Score before we are applying for the loan to check where we stand.

According to Harshala Chandorkar, senior vice president- Consumers Services and Communications at CIBIL, CIBIL report and the CIBIL TransUnion Score is a testimony of your financial discipline to banks and financial institutions for approval of your credit card or loan application. A healthy credit report and Free CIBIL Score is an indication that you manage your finances well. 

Why is it important for you to access your credit report often?

• You are always ‘loan ready’

CIBIL report contains information about your income to debt ratio as well as your credit history. This is one of the important parameters that come into factor during the loan approval process. So, before you are applying for a loan it is important that you check your credit eligibility and do your homework. Calculate how much your income to debt ratio is and also aware of your credit history and credit score. Read through the whole report and check if there is any reason for having a low credit score or any other factor such as loan settlement and find ways to correct it and increase your credit score before applying for the loan. The report will prepare you for the unpleasant surprises that you get when your loan is rejected.

• Helps you manage your accounts

The CIBIL report will help you keep a tab on the loan and credit card accounts and helps you monitor the loan performance. It also helps you to keep track of the loans that you have co-applied for and guaranteed. You can also keep a tab on the supplementary credit cards. You will not have to individually check for the status of your loans as all this information is provided on a single platform.

• Run an accuracy check of your credit history

In a place like India, there are many people with similar names and there is a good chance that the data might be accumulated wrongly under your name. So, by accessing your CIBIL report, you can look for discrepancies. There is a huge data being collected and there might be a slight error in the way it is being recorded, but that small error might cost you a good credit score. When you access the report, look for discrepancies and have them corrected through the CIBIL online dispute resolution forum. When you are applying for a loan, the wrong information could be a major deciding factor for the lender to offer you the loan and the lender might reject your application on a ground that is incorrect and when the lender rejects your loan application, it again lowers your credit score.

• Credit health check-up

CIBIL report provides you the insights to your financial health and how much debt you hold and how it is being repaid and gives you the exact number of times you have applied for a loan and a credit card. It will also have a record of the loans that you have settled and loans that were written off or if you have a suit filed against any of the loan account. When you run a credit health check-up, you can find corrective and preventive measures and help maintain a healthy credit report.

• Help you negotiate

The lenders mainly depend on your CIBIL report and CIBIL TransUnion Score to decide the terms and conditions of the loan. When you have a good credit score, you have the leverage to bargain on the terms of the loan and it serves as a powerful collateral and is an added advantage when you know that you are an ideal person that the lenders prefer to give credit.