Credit Score Tips: Bad credit score? Don't worry, follow these 5 tips and increase your score..

In today's time, credit score has become an important parameter of your financial health. This score not only affects the approval of your loan but also decides how much interest you will have to pay. The higher the credit score, the stronger your credit profile will be considered. On the other hand, a low credit score can cause difficulties in getting loans and credit cards. Therefore, if your score is low, it is very important to improve it.

A credit score is prepared by three main agencies—CIBIL, Equifax, and Experian. This score ranges from 300 to 900, in which a score of 750 or above is considered good. Those who have a low score can improve it by improving their financial habits. Here we are telling you 5 easy but effective ways to increase your credit score.

1. Pay on time
The easiest and most important way to increase your credit score is to pay all your loan and credit card bills on time. Late payment affects your credit score along with late fees. A one-time delay can hurt your score in the long run.

2. Keep the credit utilization ratio low
The available limit of the credit card should be used as little as possible. According to financial experts, using less than 30% of the credit card limit is considered ideal. For example, if your card limit is ₹1,00,000, do not spend more than ₹30,000 in a month.

3. Check your credit report
It is important to check your credit report every year. This report will tell you why your score is low. If there is any wrong entry in the report, get it corrected immediately from the credit bureau.

4. Limit new credit applications
Do not apply for a loan or credit card several times in a short period. Doing this leads to repeated hard inquiries, which can drop your score.

5. Keep old credit accounts active
Often people close old credit cards or accounts. However doing so can negatively impact your score. Keeping old accounts active lengthens your credit history, which helps increase your score.

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