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National Financial Awareness Day: How to maintain your credit health while keeping your finances in check

Any form of loan or credit card EMI payments should not be postponed, as it can have a negative impact on one’s CIBIL score.

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To avoid such situations, you could make payments run on autopay, set reminders, and create a monthly task sheet to keep score.

National Financial Awareness Day is dedicated to developing the financial principles and practices for a solid financial future. While the day is largely focused on savings and investment, credit health is equally important to maintain a steady financial stature, especially during testing times.


It is stated that millennials indulge in a lifestyle which requires spending quite a lot. Hence, experts point out, for them maintaining a strong credit score is crucial to avail of loans and credit cards in the future with better terms and conditions. Usually, those with a credit score of 750 or above have higher chances of loan approval as lenders consider them more disciplined financially, and the ones with a lower risk of credit default.

Prashanth Ranganathan, CEO, PayU Finance, explains, “The youth today is inclined to also save along with spending. While it is an encouraging fact that the youth are showing their willingness to save, having access to credit is equally important during tumultuous times.”

Note that, creditworthiness and underlying financial history can play a critical role in several financial situations throughout one’s life. “A good credit score enhances one’s eligibility for loans and credit cards, allows cheaper interest rates on loans because the lender’s risk of non-payment is reduced, allows for higher credit card limits, and faster loan approvals,” he further adds.

It is never too late to start building a credit history while it’s advised to start young. For younger millennials and Gen Z, Ranganathan points out, that being an authorised user of their parents’ or other family members’ credit cards could be a straightforward method to start building credit. Experts say, younger people can also opt for a student credit card with modest spending limitations.

Additionally, one can also adopt Buy Now Pay Later solutions like LazyPay and begin a credit journey independently. Buy Now Pay Later solutions are now also offered in a card format, such as LazyCard, a prepaid payment instrument backed by a credit line.

Ranganathan explains, “A good practice to maintain credit health is to keep the credit utilisation ratio below 30 per cent of the entire available credit limit. This goal can be reached by shifting the burden of debt from a single credit product to numerous credit products.”

Along with that, people trying to improve their credit score can maintain their credit score by lowering their credit use ratio. Moreover, Ranganathan adds, “any form of loan or credit card EMI payments should not be postponed, as it can have a negative impact on one’s CIBIL score.”

To avoid such situations, you could make payments run on autopay, set reminders, and create a monthly task sheet to keep score.

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