Top 6 Reasons for Being Denied a Credit Card and How to Overcome Them

If you have ever wondered why your Credit Card application was rejected, despite filling out the form correctly, you are not alone! The eligibility criteria for Credit Cards in India are known to be quite high, which is why many people do not own Credit Cards. The truth is, there are many reasons for Credit Card applications getting rejected, and it's not always your fault. There are several factors that contribute to rejections, besides making mistakes in your application. Here are some of the top reasons for being denied a Credit Card.

Poor credit score

Having a poor credit score can be a deal breaker when applying for a Credit Card. We've covered several reasons for low credit scores in this article. You can follow these tips to keep your credit score high -

· Avoid multiple loans,

· Avoid multiple Credit Card applications,

· Don’t apply immediately after a loan or Credit Card rejection,

· Pay your dues and EMIs on time.

Low income

Whenever you apply for a Credit Card, you will be asked for proof of income such as IT returns, salary slips for the past few months, or Form 16 along with your application. Your income is seen as an indicator of your repayment ability. So, if you are newly employed and your income is at the lower end of the spectrum, your Credit Card application may get rejected. 

Occupation
 

Some occupations, including freelancers and self-employed individuals, aren't regarded positively by Credit Card companies. Their past experiences with such jobs might not have been positive, so they tend to reject applicants from such occupations even though they fulfil the minimum criteria required. As for the reputation of your organization, this would also matter to the Credit Card issuer. Despite earning a respectable salary, if you work for a company with a less-than-stellar reputation, Credit Card companies may be hesitant to lend you money.

You are a senior citizen

When it comes to senior citizens, there is usually no source of income. Most retired individuals stop earning after retirement and rely on the returns from their investments. As a consequence, they might be denied a Credit Card.

Unserviceable location

Most Credit Card companies have a list of serviceable cities and towns. Some localities may be excluded from this list if they have a poor reputation due to a high crime rate or poor economic conditions. The representatives of the card provider verify the address provided and may recommend the rejection of an application coming from such locations. The application may be outright rejected by the bank’s system if they detect unserviceable pin codes in an applicant’s address.  

The Solution: Apply for a Secured Credit Card

Compared to regular Credit Cards, secured Credit Cards, such as the IDFC FIRST WOW! Credit Card, may be more suitable for people with less-than-stallar credit scores. They are backed by security deposits, such as a fixed deposit. You can build credit using a secured Credit Card, just as you can with an unsecured (regular) card. Moreover, regular payments and use of the Credit Card will improve your credit score.

With the FD-backed FIRST WOW! Credit Card, you earn 4x rewards on every spend, while earning up to 7.5%* interest on your fixed deposit. Moreover, it offers premium benefits such as zero foreign-exchange markup fees, no joining or annual fees, discounts at over 300 merchants and more than 1500 restaurants, and much more!

*Bank interest rates are subject to change. Please check our latest FD interest rates here

In a nutshell, you won't have to worry about Credit Card rejections with the FIRST WOW! Credit Card, and neither will you have to settle for anything less than a premium Credit Card.

Get your IDFC FIRST WOW! Credit Card to enjoy benefits like no other.

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.