10 Ways to Increase your Credit Card Limit Quickly

Credit cards have pretty much become an indispensable financial tool these days; and rightly so. Not only do they come with a host of attractive benefits and rewards, but credit cards have made big purchases easier for common people. 

However, like everything else in life, credit cards also come with some limitations. As a credit card user, you are eligible for a specific credit limit, and are needed to limit your spends within that limit. In case you are unhappy with your present credit limit and want to understand how to increase your credit card limit, we are here to help. But before that, let’s understand the basics. 

What is Credit Card Limit? 

In simple words, your credit card limit is the maximum amount you are allowed to spend on your credit card. This amount is decided by your bank, basis your individual financial profile. Your credit limit can also vary depending on what type of credit card you are using. Eg: If your credit card limit is INR 40,000, then that’s the maximum you can spend while making a transaction using your credit card. As and when you pay your credit card bill, in full or partially, this limit gets restored. 

Also Read: Form 16 Meaning, Benefits and How to Download?

How to Increase Credit Card Limit? 

Having lesser credit card limit than what you need can be frustrating. Read on for tipc to increase your credit card limit. 

• Timely repayment 

This is one of the most important factors when you are trying to extend credit limit on your credit card. Try to pay your dues in full by the due date of each billing cycle. This signals that you are a responsible borrower, and are capable of handling your debt properly. Partial payment also results in high interest charges on the due amount carried forward, and clearing your dues in full each time can help you save that money. 

• Strong Credit Score 

Your bank takes your credit score into consideration while deciding your credit limit, since your credit score is indicative of of your financial behaviour. Improving your credit score is likely to help you while you attempt to increase your credit card limit. 

Also Read: How to check loan account number (LAN)?

• Debt Clearance 

When you request the bank to increase your available credit limit, your existing debts are something they are definitely going to look at. If you already have multiple EMIs or a high outstanding amount on your credit card, your application is less likely to go through. Before you ask your credit limit to be extended, it will be a wise idea to bring down your present financial obligations. 

• Increased Income 

A higher credit limit is most likely to result in higher spends, and therefore, fatter credit card bills. Your income directly impacts your ability to repay your credit card bill, and hence an increased income is likely to signal to your borrower that you are eligible for a higher credit limit. 

• A New Credit Card 

In a situation where your bank is not able to increase the credit limit on your credit card, the next best thing you could do would be to apply for a new credit card. If you have been regular with your repayments and hold a good credit score, you are likely to be approved for a new card which can cater to your financial needs. 

Also Read: How to get urgent loan with bad credit score in India?

• Responsible Usage of Credit 

Your credit utilisation ratio is the ratio between the credit you have used against the total credit available to you on your credit limit. It is generally a good practice to limit this to 30%. This ratio indicated whether you are capable of using your credit limit responsible and spend your credit mindfully. 

While an increase in your credit limit can make purchases convenient for you, it is important to remember that credit cards are a type of borrowing, and will need to be repaid on time. Defaulting payments or heavy credit utilisation can result in a drop of your credit score, which will impact the approval of your loan or credit card applications in the future. Therefore, it is advised that you make a conscious use of your credit card.