Credit Card Tips: Keep Credit Utilization Ratio low, this loss can happen due to excessive


Credit Utilization Ratio: Digitalization has increased rapidly in India in the last few years. In such a situation, people have also started using credit cards a lot. Many banks and companies keep on giving different types of offers to woo the customers. Nowadays most of the people prefer to use credit card while shopping online. For this reason, many banks and e-commerce companies also keep bringing various schemes to woo the customers. In such a situation, people use credit cards fiercely for various benefits.

But, we should always use the credit card wisely. Failure to pay the bill on time can damage your credit score. Let us tell you that credit score is a measure of loan repayment and your creditworthiness. This credit score shows whether the customer has paid his credit card bill on time or not. Let us tell you that the credit score depends on your monthly bill and credit utilization ratio (CUR).

A CUR of more than 30 percent indicates that
Let us tell you that the credit utilization ratio depends on the limit of using your credit card every month. The more credit cards you use, the higher will be your credit card utilization ratio. If your credit utilization ratio is more than 30 percent, then it is an indication that you may be in debt and you are a risky customer.

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Correct your credit score by increasing the credit limit
Let us tell you that if you want to fix your credit score, then you can increase the credit card limit. For example, if your credit limit is Rs 1 lakh and you have used it up to Rs 50,000, then your credit utilization ratio will be 50 percent. On the other hand, if you increase your card limit to 1.7 lakhs, then your credit utilization ratio will become 29. This will be a safe zone.

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