How to Improve Your Credit Score

Credit score is important while applying for a loan or a credit card and it determines the loan acceptability by banks. Read to know more on this.
Credit Pass – Rs. 499 for 12 months
2 min read
25 May 2021

Credit score plays a key role while applying for a loan or a credit card. This three-digit number represents your creditworthiness and deems you worthy or unworthy of a loan. This is determined by certain financial behaviour such as loan repayment history, the number of credit cards you use, the number of EMIs in your name, and more such information. The four major companies that declare your credit score are CIBIL, High Mark, Equifax, and Experian.

What is a good credit score?

CIBIL Score – 600, loan application status: Rejected. Here is why? – Your credit score is not good enough.

A score over 750 is considered a good credit score. The range is from 300 to 900 and the further away you are from 850, the worse it becomes. The higher the score, the better are your chances of getting a loan or having your credit card application accepted. The good thing about this score is that it is not permanent, no matter what your score is today, you can always improve.

How to Improve Your Credit Score?

1. Evaluate your credit report

A key thing to do is check your credit report to identify any errors in it. The credit score is calculated based on the credit report, so any mistake that you discover in it must be rectified instantly.

2. Pay outstanding bills

Repayment history is a key consideration while determining the credit score. Clear any outstanding credit card bills or overdue EMIs to improve your score. Activate alerts and auto-debit options to ensure on-time bill and EMI payment.

  1. Limit the credit utilisation
    Try and keep your credit utilisation under 30% - do not utilise the entire amount of credit extended to you.
  2. Do not remove previous accounts from the report
    Refrain from removing old repaid debts, negative repayment history, or deactivated accounts from your credit report to make it look good. This is not a smart thing to do as these old accounts show your creditworthiness and removing them will work against you.
  3. Plan your finances
    It is not wise to take too much debt all at once or apply for multiple credit cards to access to a high credit limit. This may lead to repayment default because of delays and increased outstanding amounts, adversely affecting the score. Plan your borrowings so that you can repay them with ease even if there is limited cash inflow such as a loss of job etc., for a short period.
  4. Combine your debts
    Consolidating all your debts can be advantageous. Since you have to make one payment, it will be easier to pay them off


Your credit score will not improve overnight. It requires planning, patience, and consistently good credit behaviour over a period of time. To improve your credit score, start paying your dues on time and ensure to never miss an EMI payment. Bajaj Finance Credit Pass is a unique, CIBIL-powered credit monitoring tool meant to empower you to track and manage your credit factors.


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