How to keep your credit score above 700? Top 6 things to do

Consistent credit discipline is a requirement to keep your score over 700, as defined by credit bureaus (Equifax, Experian, CRIF High Mark). To have a strong repayment history, you must pay your credit card bills, and loan EMIs on time.

As well, as excessive use will cause your score to drop, it is also important to keep your credit utilisation ratio under the advisable 30% threshold. Your credit profile will also be enhanced through having a healthy credit mix such as a combination of secured and unsecured credit. Let's understand some useful ways by which you can easily boost your credit score above 700. 

Tips to keep your credit score above 700

I. Understanding credit utilisation: To keep credit score high, one should keep the credit card limit at the right level. For instance, if your credit limit is ₹1,00,000, one should refrain from spending over ₹30,000 (30 percent) at any time.

High utilisation reflects financial stress and pulls your credit score down. If needed, you can request a credit limit increase to reduce utilisation while keeping spending stable.

II. The role of timely payments: It is vital to make timely payment of credit card bills, personal loans, home loans, car loans, and BNPL (Buy Now, Pay Later) accounts. A single missed EMI can affect your credit score significantly. It is recommended to set up auto-debit for EMI payments to avoid missing due dates.

III. A healthy credit mix: A balanced mix of secured loans (home/car loan) and unsecured loans (credit card, personal loan) also helps improve your credit score. Only relying on unsecured credit can negatively impact your credit profile.

IV. Avoid excessive loan applications and hard inquiries: Each time you apply for a new loan or credit card, the bank carries out a hard inquiry, which also negatively impacts your score, albeit temporarily.

Too many loan applications in a short period (particularly personal loans) signal high credit dependence. Space out credit applications and avoid frequent rejections.

V. Correcting errors on your credit report: It is recommended to get a free credit report annually from the credit rating agency such as CRIF High Mark or other bureaus such as Experian. One should watch for fraudulent accounts or incorrect late payments and dispute errors instantly.

VI. Try to avoid closing old credit cards: The longer your credit history, the better is the score. This means even older credit cards contribute to your credit age.

If a credit card has no annual fee, keep it open even if you don’t use it often. Closing a credit card brings your total credit limit down.