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4 simple tips to improve your credit score

improve your credit score for better loans

Is it better to go to bed hungry than wake up in debt?

What do you mean by credit score?

A credit score is a measure of an individual’s ability to pay back the borrowed amount. It is the numerical representation of their creditworthiness. A credit score is a 3 digit number that falls in the range of 300-900, 900 being the highest. You should always work towards reaching a credit score that is close to 900. A higher credit score offers you several benefits and helps you at the time of getting a loan or a credit card. Having a low credit score suggests you have not been a responsible borrower and have been slacking off repaying the borrowed sum. Credit scores are calculated by the credit bureaus in the country after taking into consideration several factors like the length of your credit history, repayment records, credit inquiries, among others.

When you apply for a credit card or a loan, lenders like banks and non banking finance companies check your credit score to see whether you have the ability to repay the credit. If you have a higher credit score, you are entitled to receive preferential pricing and get discounts on the interest rate. Moreover, a high credit score gives your the additional power to negotiate for better rates of interest on loans.

What is my credit score?

Visit Experian and follow the process;


Open your Paytm App on your android or iOS device and click on the option called ‘My Credit Score’ and follow the process.

Is my credit score good or bad?

Once you have obtained your credit score, you can see in which category do you fall:

  • NA/NH : In order to calculate your credit score, you need to have a credit history. If you have no credit history, your credit report will mention that your credit score is NA (Not Applicable)/NH (No History).
  • 300 -549 : A credit score in this range is considered as a bad credit score. It suggests that you have not been a responsible borrower and have defaulted payments and have unpaid dues.
  • 550-649 : A credit score in this range is considered as average. You will need to take measures to improve your credit score.
  • 650-749 : A credit score in this range is considered as good and lenders will consider offering you credit in the form of a loan or a credit card. However, you might still not be in the position to negotiate a good deal.
  • 750-900 : With a credit score in this range, lenders will be willing to offer you a loan with cheaper interest rates. A credit score in this range also gives you the additional power to negotiate for a better deal on interest rates and credit cards with better rewards and benefits.

How do I improve my credit score?

1. Pay your credit card bills and loan EMIs before the due date:

Consistency of timely payments of credit cards and EMIs is the most important factor to impact your credit score. Please make sure that you do not miss credit card bill or EMI due dates as your credit score reduces if there is a delay in payments.

2. Reduce utilization of credit card limits:

While you may be paying your credit card bills on time, high usage of credit cards still indicates too much dependence on available credit line and possible lack of inflow of your own funds. As a result, your credit score can get negatively impacted. So, either you should reduce your dependence on credit cards or get credit limits of your credit cards increased.

3. Don’t apply for loans and credit cards with multiple banks:

When you apply for any credit card or loan with a financial institution (bank of NBFC), that financial institution fetches your credit history from one or more credit bureaus. Basis your credit history and score, the financial institution evaluates your ability to repay on time. Each credit history enquiry by a financial institution is recorded by the credit bureau from which your credit history is sought. So, if a financial institution sees multiple enquiries on your credit history by other institutions, it considers you to be credit hungry and less reliable to repay on time.

4. Obtain your credit report regularly and check for errors:

While you think you have a good credit history, in rare cases there may be certain errors in your credit history reported by your lenders to credit bureaus. As a result of these errors, your credit score could have been negatively impacted. For example: you may have completely paid off your personal loan and closed the loan account, but your credit report from the credit bureau may still be showing an unpaid amount under the same personal loan account. In such a scenario, you can approach your lender or the credit bureau to get the error rectified.

In case of any dispute surrounding any of these aspects, you may consider registering it by clicking the following link:

Also read: Need money urgently? Here is what you can do..

Disclaimer: The above article is curated based on limited and publicly available open source information. The views and opinions expressed therein and all data and information so provided is solely for informational purposes, to be used at the sole discretion of the reader. If you disagree with any article or any part thereof, please contact us and we will resolve the issue at the earliest. KyaBae makes no representations as to accuracy, completeness, currentness, suitability, or validity of any information and will not be liable for any errors, omissions, or delays in this information or any losses, injuries, or damages arising from its display or use.

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