What Is The CIBIL Score Required For Credit Card Approval? All You Need To Know
Key Takeaways:
Your credit score, along with certain other factors, determines if your credit card application is going to get accepted or not. What makes this score so important? Think of it as a summary of your credit experience.
A higher credit score not only boosts your chances of approval but can also unlock premium credit cards. These come with better rewards, lower fees, and exclusive benefits.
Understanding how much CIBIL score is required for credit card approval can help you apply smartly and work on your profile before proceeding.
What is a Credit Score and Why Does It Matter?
A credit score is a three-digit number that represents your creditworthiness. It is based on a variety of information, such as your repayment history with various creditors, your credit usage, and other types of related behaviour. It lets lenders easily assess how likely you are to be responsible with new credit.
Credit scores are assigned by credit bureaus like Equifax and TransUnion CIBIL. Thus, your credit score is often referred to as a CIBIL score. Your score is one of the must-see aspects during your application as it affects your eligibility for credit as well as the approval speed and the benefits (interest rates, rewards and perks) you get.
Credit scores typically range from 300 to 900, with 900 being the best score. If you are wondering how much CIBIL score is good, a score above 700 is generally considered strong.
Here is a breakdown of your credit score range:
| Score Range | Meaning |
|---|---|
| Between 300 and 579 | Poor |
| Between 580 and 669 | Fair |
| Between 670 and 739 | Good |
| Between 740 and 799 | Very good |
| Between 800 and 900 | Excellent |
Minimum Credit Score Required for Card Approval
Generally, a CIBIL score required for a credit card ranges between 750 to 800. If your score is in this range, you have higher chances for approval and may get access to attractive terms. A higher score reflects low risk for lenders and can result in faster approvals and better features.
Conversely, with a score of 700, you are not automatically disqualified but may have fewer options available. Typically, someone with a score in the range of 650-699 is viewed as having fair credit and may qualify for basic cards with low limits.
If your score is below 650, lenders may offer secured cards that use a fixed deposit for collateral. Secured cards can help you build or rebuild credit history and can be an ideal way to get started on your journey.
How Your Credit Score Affects Credit Card Limits and Interest Rates
Here’s why your score matters so much when it comes to the terms of your credit card:
From a lender's point of view, you are perceived as a low-risk borrower when you have a history of repaying debts on time and managing credit responsibly. Accordingly, lenders offer higher credit limits to low-risk borrowers.
Since lenders view you as reliable, your credit card fees and charges may be lower, or you may be able to get waivers of the joining fee or other charges. Most of the highest-tier credit cards that offer higher cashback, bonus rewards, and many travel benefits require a very good credit profile.
In contrast, lenders see you as a higher risk because of a low credit score, which could be the result of late payments, high debt, etc. When lenders see these scores, they may offer a low credit limit or even outright reject the application.
To compensate for the perceived risk, lenders often charge higher interest rates and other charges. In such cases, you may only qualify for secured or basic credit cards with minimal features and stricter terms.
Factors That Influence Your Credit Score
Your credit score is the result of several factors that together offer insight into your credit behaviour. By being aware of these, it is easier to maintain or improve your credit score.
It is one of the most important factors. Timely repayment of EMIs and credit card bills builds trust with lenders. Missed or late payments can harm your score significantly.
It refers to the credit you use compared to your total limit. A CUR above 30% suggests high dependency on credit and can lower your score.
The longer your credit history, the better your score becomes. A longer and active credit timeline gives lenders more data to judge your reliability and boosts your creditworthiness.
Every time you apply for credit, a lender checks your score as a hard inquiry. Too many enquiries in a short period may signal financial distress and negatively impact your score.
Having a healthy mix of secured and unsecured credit types shows you can handle various credit forms responsibly. A good credit mix can significantly improve your score.
Settled or unpaid loans on your report can affect your score. It is best to clear all dues and ensure the account is officially closed by the lender.
Mistakes in your credit report, like wrong loan status or payment dates, can lower your score. You must check your report regularly and resolve errors promptly.
Final Thoughts
One of the best ways to give yourself a leg up when it comes to acing your credit card application is to check your score beforehand. The minimum CIBIL score for a credit card is typically around 750, which significantly boosts your chances of approval and allows access to better cards with premium features.
By managing your existing credit wisely, you can pave the way for a rewarding credit card that allows you to access a range of benefits that can save you money.
Frequently Asked Questions
How can I improve my credit score quickly?
To improve your credit score quickly, pay off your existing debts. You can also ensure timely repayment of all dues, reduce your credit utilisation ratio below 30%, and avoid applying for multiple new loans or cards simultaneously. Also, check your credit report and correct any errors.
Can I get a credit card with a low credit score?
Yes, you can get secured credit cards or basic cards with a low credit score, which often require collateral or have smaller credit limits.
What is the least CIBIL score required for credit card approval?
While this depends on the issuer, you can get credit cards with a minimum score of 700 to 750. This is only valid keeping in mind that you are eligible for the card based on other factors, such as income, job stability, and more.