26 FEBRUARY, 2020

Credit cards are issued by a ton of banks and financial institutions. While applying for a credit card is as easy as applying for a new bank account, getting an approval may not be as smooth. Credit card issuers must be convinced of you as a worthy holder who meets all the pre-requisites.

Here are the steps that you must consider before applying for a credit card:

Assess and know your credit score – It can be extremely useful to know about your credit score before you apply for one. You can get your credit score estimated by various banks and financial institutions based on your credit history. Also, there are several websites that allow you to view an estimate of your credit score for no cost. Typically, these scores are not accurate, but they help you get an idea of the estimated scores. Remember, the higher the credit score, the better the chance of approval.

Make timely payments – Not making debt repayments or other kinds of payments on time can seriously dent your credit score. Thus, you must take note of your repayment schedule closely. Ensure that all your amounts are disbursed in time or they can hinder your chance of a smooth credit card approval.

Research on the right credit card for yourself – There are several types of credit cards and not each one is right for you. You may be in a hurry to get one quickly, but take your time to research and choose one that will best cater your needs. You should always consider your income and monthly spends primarily before applying for a given credit card to ensure a quick approval. From cash backs, sign up bonuses to lucrative rewards, you can earn heavily through credit card spends.

Include all your income – While applying for a credit card, include income from all sources. The issuer wants to ensure that you are creditworthy and the income disclosed is used as a determining factor of your repayment ability. However, do not provide false information by overstating your income.

Following the above steps will ensure that your credit card is approved successfully.

Credit card can be an exceptionally useful financial tool and can help you save big. From car rentals to hotel booking, you will usually be asked to make payments using a credit card. Importantly, it also helps you build a good credit score that can be very useful when financing the purchase of a new home or a car.

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.