Friends are for life! This is what we have heard and felt in many ways during our life quest. But there is one friend with whom you share your joys, sorrows and secrets. This can be your childhood friend with whom you have shared your primary class, secondary class, junior college, Degree College and also your post graduation. Now you both are ready to take over the world together and try applying for jobs in the same company and your luck, you both get selected. Months pass by and you both are performers of your division, nothing can stop you.
One day, you get a call from the credit cards telesales department of your bank offering you a credit card. You immediately say yes and your documents are getting processed. As usual drill, the tele caller asks you for any references, but obvious you give your friend’s reference and he applies for one as well. You both are anxious on what would be the credit limit of your card. The card makes it to your doorstep and you realize that you have a limit of 75000 on your card. You feel happy about it and call your friend to ask his limit. He shares that he got a limit of 1, 00,000.
Suddenly, you start realizing why is your limit lower than your friend’s? When you both work with the same organization and are almost at the same payroll you start finding answers for the same.4
Today, we will sight you the reasons why this can happen with you as well,
There are four factors which determine your limit determination or rise
A credit score plays an important role when it comes to the credit card lender determining giving you a limit. If you are in the higher side of the credit score, you can easily expect a good limit allotted to your credit card request. On the other hand, f you happen to be with a low cibil score, you cannot expect a good limit, on the other hand there are high chances, your card application may get rejected. It is suggested that get your cibil report and if you find it on the lower side, start building your credit before applying for a card.
Incomes and gains
The bank will always check your income and your employment status before processing your credit card. The higher you income, the more your credit limit would be. If you are with low income, you can still get your card processed but with low limit and privileges. This procedure is conducted only when you apply for your first ever card, for next cards you can cards on reference basis.
The lender will always check your cibil report and see if there are any other loans or cards on your account. Considering all possibilities, if the bank thinks you can manage one more card, only then they process you a card. They do not take risks when they understand that you have lines of credit on your name already and applying for another.
This usually happens when you apply for a card with your existing credit card as reference. The lender usually checks your existing card limit and your usage and if you only have used 30% of the limit, they will process your card immediately. It is suggested to make purchases through your debit cards instead of your credit cards; this will keep your card in optimum utilization and can help you get another card with ease.
You just have to make sure you are in these categories to be a limit worthy person.
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