Credit Card limit increase: Want more money? Check four ways for help

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Updated: September 18, 2019 1:01:01 PM

If one wants to enhance the credit card limit, there are different ways to go about in doing so.

Credit card, Credit card limit, Credit card limit increase, credit card spend, credit card transactions, card issuers terms and conditions, salary slips, Form 16, customer care card, credit profile, credit scoreThe credit card limit increase will depend on the card issuers terms and conditions.

Credit Card Limit: Credit card spends are on a rise. From dining to movie tickets to groceries to consumer goods to flight tickets and online purchases, credit card spend and usage is on a high than before. With a push towards more digital transactions, swiping the card is no more just another fad but perhaps it is here to stay for long. Card users, however, need to make optimal use of the cards and follow prudent card practices to ensure not to fall in a debt trap. Avoiding any roll-over of credit to next month billing cycle and making entire outstanding payments on the due date is what all credit card holders need to stick to.

However, making credit card transactions on most of your needs could soon exhaust your monthly spend limit. This is where, increasing the credit card limit has its role and one can consider to enhance the credit card limit for better usage. The credit card limit increase will depend on the card issuers terms and conditions. “Approval will depend on things like your income, job stability, repayment behaviour, credit score, spending patterns and the age and quality of your relationship with the bank,” says Adhil Shetty CEO, Bankbazaar.com.

If one wants to enhance the credit card limit, there are different ways to go about in doing so.

1. Enhancement by card issuers

At times, credit card issuers offers an enhancement in the limit by intimating cardholders through SMS or email. Opting for such will lead to increasing credit card limit. “Credit card issuers send credit limit hike offers to its customers from time to time based on the user’s positive repayment behaviour and the age of the credit line among other things. Also, it’s not unusual for card issuers to offer an automatic limit hike during the annual card renewal process,” says.

2. Online enhancement

If you already hold a credit card, you may log on to the bank website and check in the credit card section. You could be eligible as per the bank’s terms and one can apply online too. Generally, eligible cardholders do not need to furnish any additional documentation for such enhancement.

3. Apply for an upgraded card

Most card issuers have different variants of card depending on usage and catering to different income level. For higher limits, you may ask your existing or another card issuer to issue a new one with higher limit. In the process, if you have to close or cancel credit card, do so by following the proper process.

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4. Contact customer care

Trying your luck by calling the customer care card issuer and asking for credit limit enhancement may also work. “Usually, a limit increase request, if agreed, is approved without having to submit any additional documentation. However, the bank may also ask for additional documents like latest salary slips, Form 16, etc. to make a decision,” says Shetty. In case, you had a salary hike in the recent past, furnishing copies of income proof might also work.

Advantage of increasing credit limit

Credit Utilisation Ratio (CUR) is an important ratio that every credit card user need to keep an eye on. If one utilises the credit limit up to or near the sanctioned limit, the CUR will be high and will reflect the fact that one uses a lot of credit. Avid this by going for an upgraded card or enhancing the limit of the existing card. “ A limit increase will also keep your CUR under control and further boost your credit score,” informs Shetty.

But, remember, the decision to enhance or not will depend on the card issuing company. “Truth be told, banks have the final say (and the only say) when it comes to determining and enhancing credit card limits. Credit limits differ not just according to card variants but also for different users using the same variant,” says Shetty.

To sum up

Credit card usage should be such that it gives you the convenience of transacting through digital means. Getting into the habit of impulsive buying using the plastic could soon put you in a debt trap. Avoid rolling over at any cost as interest rate charges on outstanding is 3.5 per cent or even higher in some cards. Above all, your credit profile is impacted and the credit score may get a hit. “If your credit limit request has been declined by the bank, avoid applying for multiple cards in a rush. This will be seen as credit desperation and will impact your credit score,” says Shetty.

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