5 Ways to Increase Credit Card Limit

 5 Ways to Increase Credit Card Limit

Are you a credit card user? Then this video is for you. If you want to increase your credit limit, don't miss this video because we are going to discuss five ways to easily increase your credit limit by at least forty percent, automatically.

Let's learn about these five methods that you can easily adopt. First, let's understand what a credit limit is. When we apply for a credit card, banks or credit card companies give us a credit card with a limit, meaning a card can have a limit of, for example, forty thousand, one hundred thousand, or even up to two hundred thousand, etc. When banks or credit card companies issue a card, they do so with a certain limit, and we cannot use an amount exceeding this limit because a credit card is essentially a loan granted to us, and it depends on various factors.

Now you may ask why the credit limit is limited to only fifty thousand, one hundred thousand, or two hundred thousand. Well, it depends on your eligibility and the type of credit card you are applying for. The limit is set by the banks based on your eligibility. Now, let's talk about how you can easily increase your credit limit.

The first and easiest way is to pay your dues on time. If you are using one or more credit cards today, it is first checked whether you are making all card payments on time or not. If, for example, you miss a payment on one or two cards by chance, it goes into your history as a default, and as soon as your default occurs, your credit score also goes down. Due to many such factors, your credit limit will not increase, and your credit history will worsen, and your credit score will also go down. So always keep in mind that if you want to increase your credit limit in the future and if you use a lot of credit cards, it is essential to pay your dues on time.

The second easiest way to increase your limit is to try to increase your credit score. If your credit score is good today, it depends a lot on your financial history. For example, if your credit score is good, you can easily get a loan, a credit card, and your credit limit can also be easily increased. If your credit score is low today, I have made another video where I have explained how you can easily increase your credit score. If you need to increase your credit score, you can watch that video. You can also do this if you are using your credit card today, use it frequently, and clear all your bills before the due date. As soon as you clear your bill on time or before the due date, your banks and credit card companies, lenders, gain confidence that you can easily manage your debts and handle your financial liabilities. This confidence will help you increase your credit limit.

The third most important point is to keep your credit utilization in check. If you have multiple credit cards today, ensure that the credit utilization ratio for all cards is only thirty percent. Experts say that when you use your credit card, you should only use thirty percent of it. Experts say that if your card has a limit of one hundred thousand, for example, you should only use thirty percent, or thirty thousand rupees. This way, you get two benefits. One, if you keep your credit utilization ratio low, meaning you don't exceed your credit card limit or use it too much, your lender will trust that you are not too dependent on your credit card to cover your financial expenses. They will think you are financially stable, and this could lead to an increased credit limit. Second, if you keep your credit utilization ratio very low, your credit score will automatically go up, and when your credit score goes up, lenders will automatically offer you the opportunity to increase your credit limit.

The fourth way is to reduce your financial obligations if they are too high. If you go to any bank or lender today to increase your credit card limit, it is obvious that the bank will first check your liabilities, your financial obligation, whether you have taken a home loan, whether you are paying a home loan EMI, or whether you have taken a personal loan and are paying its EMI, or whether you have taken an education loan or any other loan for which you are currently paying EMI, how much your previous credit card bill is, whether you have defaulted or not, etc. So it is obvious that your history will be checked first. And if they think your financial obligation is too high, your monthly income is seventy-five percent of your salary, which should only be fifty percent, and if this is the case, your credit limit will not be increased. So experts often believe that if you want to increase your credit limit, first check how much your financial obligation is. If it is too high, first reduce your financial obligations, reduce your EMI, and then approach to increase your limit.

The next step is to provide proof of different sources of income to your banks or lenders if you want to increase your credit limit. Many times we make the mistake of using our old credit card, and now our salary has increased. In such cases, the banks and lenders have old information. For example, if I applied for a credit card five years ago when my salary was very low, my eligibility, or my credit card limit, was set according to that salary. But today, five years later, when my income has increased, they will not have this proof. So if something like this has happened to you, if this is your case, it is recommended that if your salary has increased today, you can approach your banks, show them your pay slips, and proof of income, and request them to increase your credit limit.

These are the five easy ways you can adopt to increase your credit limit. If you have tried a different strategy, you can tell us in the comment section and share with others how you have increased your credit limit, or how you manage your debts, in order to use the credit card wisely. And if you liked this video, don't forget to like and share it, and if you haven't subscribed to this channel yet, please subscribe. Thank you for watching.