Credit cards are the new best friend for customers. Their swanky rewards, easy use, and affordable costs are making them a new favorite in an economy grappling with a cash crunch.
The Economic Times published a report based on the Reserve Bank of India’s finding stating that the credit card market stood at 47 million in the year 2019. With the pandemic causing considerable issues for an otherwise cash-rich economy, experts predict a compound annual growth rate of over 25% in the next five years.
Why should you be left behind? You can follow the below steps to ensure that your credit card application is also approved in a jiffy
- Eligibility - Understand that every credit card issuer has certain eligibility criteria. If you are a first-time user, you might not be eligible for high-end premier cards because your income plays a major role in their approval. The eligibility criteria may include basic things like age, citizenship, and most importantly your net income figure.
So, opt for a credit card whose eligibility criteria you can meet.
- Documentation - Simple things like a mismatch in your personal details and the ID proof submitted by you can result in a rejection. Be careful when you fill out your personal details that can be cross verified by the documents that you attach. Your name, address, age, signature, etc., should match the credit card application form that you filled.
- Credit Score - This is the most important factor that is considered while issuing a credit card. Your credit score is the reflection of your financial well-being. Higher your score the more likely that your application gets approved.
Your credit score depends on your promptness of paying bills, being regular in paying your EMIs, not having too many loans, low debt quotient, etc. Hence, ensure that you always maintain a respectable and high credit score.
- Frequent Applications - It is not advised to make frequent applications to various credit cards at the same time. Make an informed choice and then apply for the credit card that you wish to use. In case, it does get rejected, do not reapply immediately.
All credit card issuers have a tab on the number of applications that you have made. If your applications are frequent and immediate, they will conclude that you are having financial trouble and will probably not be regular in your repayments.
- Clear your Debt - Too much debt would make credit card issuers vary from approving your applications. You must pay off your bills on time and cut down on too many loans if you have them.
The understanding behind this is to evaluate your creditworthiness. If you are a borrower who is already bogged down by debt and other EMIs, credit card issuers may not find you worthy enough to provide more credit. Hence, before applying ensure that you do not have any pending payments or debt.
- Rejection Reason and Reconsideration - In case your application is rejected, do not lose heart. Have a frank and honest discussion with your issuer to understand the cause of the rejection. Some banks may not share the reason for rejection due to their policies. You may even request them for a reconsideration if their policies allow for the same.
Overall, owing to the increasing demand and influx of many players in the credit card market, it is fairly easy to get a credit card of your choice. However, you must consider the above factors to ensure that you have a smooth application process and receive approval soon.