India is world’s fastest growing economy. It’s highly adaptive for new changes and thus has been highly influenced by the concept of online banking and plastic money. Since the wave of demonetization hit, the ratio of using net banking and plastic money has drastically increased. Net banking includes online transaction from bank to bank or from consumer to dealers; whereas plastic money means usage of debit and credit card.
Credit cards have been in India for a very long time but from last few years number of people using credit card has increased drastically. Various banks offer various types of credit cards to its customers. Credit cards are given as per the credit score of the customer and his/her financial history. Banks offer credit card with minimum documentation and many times credit cards are approved quickly. But in some cases banks do not approve a credit card. We strongly believe that you should not miss out on the benefits of using credit card. That’s why we have come up with a list of reasons because of which your credit card application can be rejected. Go through the list and know the things to avoid or to be prepared for while applying for a credit card.
1. You have insufficient or weak credit score
Banks require a healthy credit score to approve a loan or credit card. Usually 750 out of 900 is considered as a good credit score. If your score is higher than 750, you are in luck! But its lower or even zero, the chances of you getting a credit card are the lowest. Your credit score showcase your financial ability to handle a credit card. If your credit score is weak or nil, banks can’t trust you enough to offer funds on credit as they are not sure whether you will be able to pay the credit card bill or not. Thus your credit card application can be rejected if you have insufficient or weak credit score.
2. You do not fit into the minimum age criteria
Banks are very specific when it comes to the eligibility criteria in approving the credit card application. Banks do not offer credit card if you are too young, because you may showcase inability to pay off the credit card bill. Having a credit card is a responsibility and privilege. Banks need to be sure that you are capable to takeover that privilege with responsibility. Age is one such criterion by which banks decide your nature of being responsible. Banks approve a credit card to the applicants who are minimum 21* years old. If you fall short on this criterion, banks reject your application for credit card.
3. You have a history of unstable employment
Many people tend to hop on their jobs as they do not believe in working at one place for long tenures. The job changes can be a result of any personal or professional reason but that can affect your credit card application. Your habit of constantly changing jobs like a hopper can be viewed as an unstable thread of your personality. It showcases your unstable income thus making you vulnerable to pay off the credit card bills. So if you have changed multiple jobs in recent times, banks can reject your credit card application.
4. Your income is low or very minimal
Banks offer various types of credit cards for various needs of the applicant. Each card has its own benefits and credit limit. The credit limit is decided on the income status and other financial obligations of the credit card applicant. To get a credit card you must have a minimum annual income of Rs. 2 lakh* if you are a salaried employee. But if you are a self-employed professional, you must have an annual income of minimum Rs. 1.5 lakh*. If your income is lower than these figures, your banks reject your credit card application.
5. You have multiple financial obligations
Many people have multiple cards or various financial obligations. Various financial obligations include 2 or more EMIs for various loans, existing credit card bills or any other debts to be paid off. These multiple financial obligations may strain your monthly financial budget. So if you apply for a credit card, banks reject your application because you get yourself into an additional debt to pay off.
To check your eligibility to get a credit card