A credit score of 670 is not considered a healthy credit score in India. Such a score can pose serious challenges when the borrower applies for a new credit card or a personal loan.
Still, there are strategies that can boost and enhance the chances of approval, even with a low credit score.
According to Sameer Mathur, MD and founder of Roinet Solution, “If your credit score is around 670, obtaining a credit card is still possible with the right approach. Begin by considering a secured credit card, which offers high approval rates and helps rebuild credit.”
He adds, “Check for pre-approved offers to avoid hard inquiries that could further impact your score. Providing proof of steady income or applying with a co-applicant can strengthen your application. It is advisable to avoid premium cards and instead opt for entry-level options from established banks or NBFCs. Lastly, reduce your credit utilisation and clear any recent dues before applying to enhance your internal creditworthiness.”
Here are five smart ways to get a credit card with a low credit score of 670:
1. Opt for a secured credit card
Secured credit cards backed by fixed deposits (FDs) are easily available to individuals with low credit scores or poor credit history. Banks such as Kotak Bank, ICICI Bank and Axis Bank provide secured credit cards with minimum fixed deposit amounts ranging from ₹10,000 to ₹25,000.
The credit limit in all such cases typically ranges from 75% to 90% of the total fixed deposit value. Sensible management of such credit cards, responsible usage and timely credit card payments can help rebuild your credit score over time.
2. Consider add-on credit cards
If your family member holds a primary credit card, then you can request an add-on card. This will help you benefit from their credit history, allowing you to build your own credit profile and a healthy credit score by consistently making the payments of your credit card bill and EMIs on time. It is crucial to use the card in a sensible manner to prevent any long term negative impact on your credit score.
3. Apply for cards from smaller banks or NBFCs
Several smaller banks and NBFCs have lenient credit lending terms and can offer credit cards to applicants with lower credit scores as well. Even in such cases, borrowers might need to meet several other eligibility criteria, such as paying higher interest rates, having lower credit limits and less flexibility in repayment schedules.
Such financial institutions might even consider your income stability, tax filing status, and past employment history during the entire evaluation process. In the end, if the expectations of the lending institution are not met, then your credit card application might even be rejected.
4. Demonstrate composure and financial stability
If you can provide proof of steady income with salary slips, income tax return documents, etc., then such documents can boost your credibility and the potential of your application to be accepted.
Lenders look for individuals who are honest, have a reasonable source of income, and are sincerely willing to make timely repayments of EMIs and credit card bills.
Therefore, if you can showcase such qualities, you are more likely to get your request approved. Trust and integrity are key elements of this process.
5. Improve your credit score and boost your credit profile
While aiming to secure a credit card, consistently work on boosting your credit score:
- Make timely repayments of existing credit card bills and loan EMIs.
- Focus on maintaining a credit utilisation ratio of less than 30%.
- Consistently monitor credit reports for inaccuracies.
- Avoid multiple credit card and loan applications in a short period of time.
- Raise a dispute if you find any discrepancy or issue in your credit report.
Therefore, implementing these simple practices can improve your credit score by 50 to 100 points. This can take time, but can generally be achieved within six to 12 months. Such a development will positively boost your eligibility for better credit card products in the future.
Disclaimer: Mint has a tie-up with fintechs for providing credit; you will need to share your information if you apply. These tie-ups do not influence our editorial content. This article only intends to educate and spread awareness about credit needs like loans, credit cards and credit scores. Mint does not promote or encourage taking credit, as it comes with a set of risks such as high interest rates, hidden charges, etc. We advise investors to discuss with certified experts before taking any credit.
