While applying for a credit card, the Bank will rightfully check your Credit Score. If you have a good score then you are in a favourable position, but if you don't then you might be in a tough spot. This is because lenders might not approve your credit card applications and the interest rate on pending amounts will start increasing. So, first things first, before making any credit application, ensure your credit score is satisfactory, and if not then you must start improving it. Buying credit cards for Bad Credit score can be one of the ways to start your journey.
Before applying for a credit card, you must understand what are the types of credit cards-
A secured credit card requires an initial security deposit. This deposit acts as Collateral, providing the creditor with security, in case you Fail to make payments. The Credit Limit on the secured credit card is usually equal to the amount you’ve deposited. If you want to Improve your Credit Score then this is the right credit card to start with.
An unsecured credit card doesn’t require any security deposit. The majority of the credit cards available in the Market are unsecured credit cards. The credit limit offered will be based on your credit score. If you're suffering from a constant bad Credit Report then these aren't the best credit cards for bad credit score.
A secured credit card, unlike the usual credit cards, may not offer attractive benefits and rewards, but it can be a lifesaver for those who are reconstructing their unsatisfactory credit history.
Following are the 5 best credit cards for bad credit score-
|Credit Card Name||Benefits||Fixed Deposit Amount Required|
|ICICI Bank Coral Credit Card||Dining & Shopping||Rs. 20,000|
|SBI Advantage Plus Credit Card||EMI benefits||Rs. 20,000|
|ICICI Bank Platinum Credit Card||Fuel & Dining||Rs. 20,000|
|YES Prosperity Rewards Credit Card||Rewards, Dining & Fuel||Rs. 50,000|
|Axis Bank Insta Easy Credit Card||Rewards & Dining||Rs. 20,000|
In order to get this card, you need to first make Rs. 20,000 in the fixed deposit for at least 180 days.
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The SBI Advantage Plus credit card requires you to pay an annual fee of Rs.500 and renewal fee of Rs. 500.
The ICICI Bank Platinum credit card requires a fixed deposit of Rs. 20,000. No additional annual fee or joining fee is charged.
The YES Prosperity Rewards Plus credit card needs a fixed deposit of Rs. 50,000. A joining fee of Rs. 350 is charged and a further annual fee of Rs. 350 is charged.
A fixed deposit of Rs. 20,000 is required to get Axis Bank Insta Easy credit card.
Typically, the Credit Score Ranges from 300-900, any score above 750 is considered to be the best score. Let’s take a look at other ranges-
Having a bad credit score is not favourable for your future finances. Loan and credit card applications may be disapproved and you might need to settle down for high-interest loans. That is why you should always keep your credit score high!.
Here are some of the common ways how one can rebuild and improve his credit score-
Paying back loan EMIs and credit card dues before the due date reflects the person’s ability to repay the debt. Missing repayments will drop your score.
Always try to keep your credit utilization below 30-40%. A low credit utilization represents an ideal spender and not credit hungry.
Too many hard inquiries about credit cards or loans in a short span may damage your credit score. Make an inquiry only when you are in need of credit.
You are eligible for one free credit check every year so make the best use of it. Keep monitoring your credit report to ensure all the information is accurate as any errors can drop your score. Check your personal details, account details, etc., in case of any inaccuracy report to the credit bureau immediately.
Your oldest credit account will have the most weight in your credit history. When you close such accounts, you wipe off the history of it. In short, the older your credit age, the more responsible you will appear to the lenders.
Following is a list of documents that you need for a credit card-
A secured credit card one of the most effective ways to rebuild your credit history. However, you must remember to follow good credit habits, in case you fail to do so, your credit scores will definitely get affected.
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