Credit Cards have become an indispensable part of life these days for many people. And one of the realities people must deal with is the existence of the Credit Card limit. As you may well be aware, you cannot spend an unlimited amount on your Credit Card. There is a specified Credit Card limit beyond which you cannot spend. This can act as a brake on your purchasing power.
Several things determine this Credit Card limit; it can vary from card to card and even from individual to individual. The bank fixes the limit, depending on their perception of your ability to pay. Some of the factors they take into account are your income – higher your income, higher your Credit Card limit is going to be. Another thing they look at is your Credit Score, which depends on your record of repayments of debt. Higher your Credit Score, higher your credit limit will be.
Of course, this limit is not written in stone; it’s possible to increase credit limit. This will work if you have been using your Credit Cards successfully, paying all your dues in time and making the best out of your rewards and offers. Now you may rightly feel that you increase credit limit.
If you can afford it, and the bank is willing, it’s always a good idea to increase credit limit. After all, you don’t want a lack of liquidity to constrain your lifestyle needs. You can use your Credit Cards for everyday shopping, to take that holiday abroad, to pay your kids’ fees, and to splurge on eating out now and then.
The question then arises – how to increase your Credit Card limit. Can it be done quickly?
Here are few tips to increase your Credit Card limit:
- Request for increased limit on existing card – How to increase credit limit on your existing card? Is this possible? Yes, your bank can do that for you. It may increase the credit limit of your existing card if you make a request. This, of course, will depend on various factors, like your credit history, credit score and income. In case you own multiple cards, it is essential to select the card for which you would want to increase your limit.
- Offer more information -- Sometimes banks may be unaware of any change in your financial status that could make you eligible for a higher Credit Card limit. For example, you may have received a substantial pay hike in the past few months, but you continue to use your old Credit Card with its existing limit. If that happens, you can give this information to your bank and ask them to either increase your limit to match your new financial status or issue a new card with a higher limit. It could also help if you consolidated your accounts to give the bank a better financial picture. For instance, if you have several bank accounts with small sums in each, it’s better to put them all in one account.
- Annual increase – Most banks offer an annual increase in credit limit if you have paid the balance on time. You can check with your bank about the same. Most banks themselves offer an annual increase. Even if you don’t need one, it can help to take the annual credit limit increase. It comes with very good offers on rewards, and you never know when you might need a higher credit limit.
- Improve your credit score: Since banks consider credit score while setting Credit Card limits, it’s better to ensure that you have a good score. You can do this by paying all your dues, like EMIs, on time. So it’s best to avoid doing that. Keeping your spending within limits can be helpful.
Now that you know how to increase your credit limit, there’s nothing that stops you from going for it. It’s always a good idea to have a higher Credit Card limit; you never know when you will need it. It can come in especially handy if there is any financial emergency – like hospitalisation.
Of course, you should understand that issuers perform due diligence before granting an increased credit limit. You can increase credit limit only if you meet their specifications. But if you have the means and the credit record, there’s no reason why a bank will deny Credit Card limit increase.
To apply for HDFC Bank Credit Card, click here.
To check LE eligibility on your card, click here.
* Terms & conditions apply. Credit Card approvals are at sole discretion of HDFC Bank Ltd. The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.
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