Income: Your Ultimate Guide to Unlocking Credit Card Approval
The credit card eligibility criteria that banks and card companies have can sometimes feel a bit mysterious, but one of the biggest factors they always look at is your income. Many people get a new credit card to manage their everyday expenses better or for bigger purchases.
This is why understanding why your income is so important can help you navigate the application process smoothly. It’s a key piece of information that helps lenders figure out if a credit card is a good and manageable option for you right now.
Why Do Issuers Care About Your Income?
When a issuer gives you a credit card, they’re letting you borrow money. So, to determine whether you’ll be able to pay it back without any delays, they look into your income. If you have a steady income, whether from a job or your own business, it shows them you’ve got money coming in regularly.
This indicates to lenders that you can manage credit card payments responsibly and on time. A stable income assures lenders that you’re capable of repaying your dues on time, which reduces their lending risk.
Why Your Income Takes Centre Stage?
When you apply for a credit card, lenders are deciding whether to lend you money and if you’ll pay it back later. Your income is a primary tool they use to figure out a few key things:
- Your Ability to Repay
As a key part of the credit card eligibility criteria, issuing companies need to feel confident that you have enough money coming in each month to not only cover your usual living costs but also to pay your credit card bill.
A steady and sufficient income suggests you can manage the repayments without falling into financial difficulty. Issuer lend money cautiously to ensure you can handle the credit.
- How Much Risk Is Involved
From the issuer’s perspective, lending money always carries some risk. They use your income level to gauge how much risk they are taking. A stable income generally indicates a lower risk because it implies the ability to manage credit and repay debt.
- Setting Your Credit Limit
Your income also directly influences the amount of credit you get offered. If you have a higher income, credit card companies are typically willing to provide you with a higher credit limit on your card. This is because they see your income as promising enough for you to manage more money.
Conversely, if your income is lower, they will approve a smaller credit limit to ensure it’s something you can easily handle. So, by providing your income details, you’re giving the banks and issuers a crucial piece of information that helps them make a sound lending decision and set appropriate terms for you.
Income-Friendly Ways to Get a Card
If you’re worried that your current income may not qualify you for the card you want, don’t lose hope! There are other ways to access credit:
- Go for a Secured Credit Card
This is a brilliant option. To obtain a secured credit card, you open a fixed deposit (FD) with the issuer. This FD acts as security for them, and they issue a credit card with a credit limit that’s usually a substantial portion of your FD amount, typically 80-90%. It’s an excellent way to get access to credit, especially if you want to build your credit history.
- Look for a Card with Lower Income Thresholds
Some credit cards are specifically designed to be more accessible, featuring flexible income eligibility criteria. It’s a good idea to check with issuers or visit their websites to find cards that better match your financial profile.
- Prioritise Value with No Annual Fee Cards
When income is a key consideration, you want every rupee to count. That’s why choosing a credit card with no annual fee makes a lot of sense. By avoiding yearly charges, you gain immediate savings and reduce the financial burden on your monthly budget.
When it comes to credit cards that are easy to manage and offer good value, the One Credit Card is a great choice. Also, if you’re just beginning your credit journey, you can opt for the secured version of this card, making it accessible even without a credit score.
A major highlight of the One Credit Card is the OneCard App, which brings all card controls to your fingertips. From setting budgets and tracking transactions to converting large payments into EMIs, every feature, including the application process, is entirely digital and seamless through the app.
As you spend responsibly, be sure to take full advantage of the valuable rewards this card offers. With its 5X rewards feature, you earn five times the points on your top two spending categories each month. These points accumulate in real-time, and you can redeem them at your convenience as they don’t expire.
In addition, it is a lifetime-free credit card, meaning there are no annual or joining fees. When combined with its user-friendly digital experience and rewarding features, it’s one of the best no-annual-fee credit cards available in India. Download the OneCard App today to explore its benefits and apply now if it suits your needs.
