How to Increase Your Credit Card Limit – Tips & Benefits

Just like cash, credit cards are an equally important part of our financial life. A credit card will come in handy when we are low on cash or want to purchase anything that needs additional funds. Credit cards are now considered a necessity of the hour because they can help us get whatever we want. However, a credit card also has its limitations, which depend on you completely. 

The credit limit you have on your credit card determines the amount of purchasing power you have. If you think the credit limit you receive is low or due to some reasons your credit limit is reduced, then read this blog till the end because it will assist you in raising your credit limit.

Ways to increase your credit limit

Why do we need a credit card? We need it because we want to enjoy our lives without worrying about the financial limit. When we apply for a credit card, we expect a good credit limit that can fulfill all our needs. If you’re wondering what the relation is between a credit card and credit limit, then let me tell you, a credit card comes with a credit limit that is the actual amount you’ll get to spend by using the card. The credit limit you get depends on various factors like credit history, income source, outstanding credits, and others. Banks do background research before allotting the credit limit. If you think your credit limit is low, then you should follow these steps to raise your credit card limit:

• Timely payments: You should pay all your credits before their due date, as it reflects that you are responsible and can pay all your bills on time. Banks offer a higher limit to those customers who clear all their dues on time and avoid any delays. 
• Clear outstanding bills: If you have unpaid bills or outstanding dues, then your credit limit is negatively affected. To increase your credit limit, you should clear all your existing dues and avoid delayed payments in the future. 
• Credit Utilization Ratio: Avoid using your full credit limit; instead, use 30% of the credit limit to increase your credit limit. Always remember your CUR should remain below 30% as, according to banks and other lender’s it is the ideal ratio that can help in credit limit increment.
• Growth in Income: If you have recently received a hike in your income, then you should share it with the bank and submit the proof of the same. Banks will automatically increase your credit limit considering the growth in income. 
• Request the lender: You can directly put a request to the credit card lenders to raise your credit limit. Generally, banks and other lenders accept the credit limit request and increase the limit. 
• New credit card: You can also apply for a new credit card with a higher limit than your previous card. If you have been paying your bills on time, then the bank will approve your new card application with a higher limit.

If you want to raise your credit limit, you need to adhere to this complete guide. Make sure you remain consistent and wise so that banks automatically increase your credit limit, but if you miss any of these steps, you might face a decline in the limit, so be careful about it. 

Why is a high credit limit important?

When you have a good credit limit, you worry less about the financial constraints that can occur anytime because you already have a solution to it. A higher credit limit has several advantages, including:

• If you have a high credit limit, banks know that you’re paying all your credit on time, which will automatically affect your credit score, but in a positive way. Hence, a high credit limit is equal to a high credit score.
• A credit with a high limit includes additional perks like bonus points, cashback, rewards, and much more.
• When you have a high-limit credit card, you stop applying for more credit cards. 
• Banks approve your loan applications quickly when you have a credit card with a high limit because it shows that you have a good credit history.
• For those unprepared situations where a large sum of money is required, a credit card with a good limit is helpful.

Whom to contact for a raise in credit limit?

To raise the credit limit of your card, you should contact:

• Online Process: You should visit the official website of your card issuer bank, navigate to ‘credit limit request’, and start applying for the same by submitting the required documents. 
• Contact Customer Service: You can contact the customer support team either through a call or an email and request that they raise your credit limit. You need to be prepared to answer a few questions regarding your income and financial history. 
• Visiting Banks: You can directly visit your card issuer bank and request that they raise your credit limit. They might ask you to write a formal application for it with the necessary documents. So, be prepared in advance for it.

Conclusion

In summary, if you have a low credit limit, then you can follow this credit limit guide to increase it. You must now be fully aware that your credit limit depends upon your financial history, so make sure you have a good one to avoid a low credit limit. However, if you still receive a low credit limit, then you can try to improve it by requesting the bank, making timely bill payments, clearing pending dues, or just by maintaining the CUR. If you follow this consistently, then the bank will increase your credit limit. All you have to do is show banks that you’re a responsible user and can pay credit bills on time. 

Also Read :- Best Personal Loan in Pitampura up to ₹50 Lakh - Apply now

Frequently Asked Questions (FAQs)

Will my credit score increase if my credit limit is increased?

When your credit limit is increased, your credit score automatically increases because it reflects that you’re responsible and consistent with all your credit and never miss your bill due dates. 

How much time does it take to increase the credit limit?

Your credit limit increase request usually takes a week or maybe months to get accepted. However, the duration varies from bank to bank, as all banks have different policies and protocols. 

How should I write a request to the bank to raise my credit card limit?

You can write a formal email or a formal application to the bank directly by simply stating why you deserve a raise in your credit limit. Make sure to include all the good possible reasons, like you have a hike in income, you didn’t delay any payments, or you paid all your bills timely, such statements can easily get you a credit limit increase.