Best Credit Card for Fair Credit - Know Best Fair Credit (2024)

When one applies for a credit card, it is important to know that the rejection or approval of one's credit card depends largely on the credit score. Credit Information Bureau India Limited (CIBIL) credit score is a value that is calculated on the basis of one's credit files that has the individual's creditworthiness. It carries details of the credit that one has availed throughout time. Details include particulars like the amount of credit taken and how much of it has been repaid and how. In case the person has missed making even a single payment or has paid off a loan, it will reflect on the credit score. CIBIL calculates credit scores on the basis of at least 6 months of monetary history of the individual.

What is a Good Credit Score?

Credit score set by CIBIL ranges from 300 to 900. The following are the various divisions of credit scores that determine the creditworthiness of the individual:

• A good credit score ranges from 750-900. The closer one is to 900, the greater the confidence of the lending institution will be in them.
• If the credit score is in between 650 and 750, it determines that the individual will not face too many hurdles while applying for credit cards and loans.
• A credit score that lies between 550 and 650 indicates that the individual is fairly regular with payments. The banks will be cautious but might trust them with new loans and credit cards if other criteria is met.
• A credit score that lies in between 350-550 is considered to be poor. It indicates that the individual has been defaulting on making payments and there are slim chances that their loan application would get approved. Also, banks would not be keen on giving them a new credit card.

Eligibility Criteria for Credit Cards

There are certain eligibility criteria that an individual needs to meet in order to avail a credit card. Some of these parameters are as follows:

• The applicant should be at least 18 years of age. Individuals below 18 years can only avail an add-on or a supplementary credit card.
• Every credit card has its own minimum annual income requirement. The applicant will have to submit proof of his income in the form of salary account statements.
• Applicant should have a good credit score. A good credit score will make it easier for the banks or other financial institutions to offer a credit card to the applicant. On the other hand, a poor credit score limits the applicant's options.

Here's how one can Bag a Credit Card with a Fair Credit Score

Generally, borrowers dismiss the idea of getting a secured credit card because it demands a security deposit that is to be made against the credit limit. Not many understand that a secured credit card that is accountable to the major bureaus is better than not owning a credit card at all. While an average credit score is always better than a bad one, one can use a secured credit card to make their credit history healthy. After a year of timely payments, a lot of secured credit cards can be changed to unsecured credit cards. There are plenty of credit cards available in the market that are targeted at people with a fair credit score. Here are a few tips on how to get a credit card with an average credit score:

• An individual with a fair credit score can approach the bank that they have a savings account in for a credit card. Since that bank is updated on their financial status, it makes it easier for them to offer a credit card to someone who has an account with them.
• Banks like HDFC, SBI, among others provide secured credit cards against a fixed deposit account of nominal value.
• People with a fair credit score can approach the bank that they have their salary account in for a credit card. It is easier to get a credit card from this bank because even if the cardholder defaults in making payments, the bank knows that they can deduct it from the salary account after fair warning.

Five Credit Cards for People with a Fair Credit Score

Though there are quite a few credit cards that are available for people with a fair credit score, listed below are few good options:

• Standard Chartered Platinum Rewards Card
• SBI Simply Click Credit Card
• Axis Bank Insta Easy Credit Card

How to Improve One's Credit Score

Improving one's credit score doesn't happen overnight. It takes time. Here are a few tips that can help one in boosting their credit score:

• The first step is to make sure that their credit reports are updated and accurate. It is advisable to keep a keen eye on the reports.
• The next step is to fix one's late payments. This can be done by making all the pending payments on time.
• Paying EMIs on time is also important as this is one factor that CIBIL takes note of while calculating one's credit rate.
• It is important to make sure that the credit card is not used for every purchase that the cardholder makes. Keeping a check on the credit utilization ratio helps in improving the credit score.

Although an average credit score is not as bad as a poor credit score, it is still advisable to aim to keep the credit score healthy. This not only creates a good financial impression on the lending organizations but also helps in leading a worry-free life.