Using over 30% of your credit card limit? Here’s why it’s hurting your score and how to fix it

Using more than 30% of your credit card limit regularly can hurt your credit score. This shows lenders you rely too much on credit and may struggle to manage repayments. Try to keep your spending below this limit to maintain a healthy score. You can also request a higher limit or pay bills multiple times a month to lower your credit utilisation ratio.

Your credit utilisation ratio shows how much of your total credit limit you use.
⦁Example: If your card limit is Rs lakh and you spend Rs 40,000, your CUR is 40%.
⦁Ideal CUR: 30% or lower — this signals good credit behaviour.

If your credit utilisation ratio (CUR) goes above 30%, it may signal that you are too dependent on credit, which can lower your credit score even if you pay on time. Banks view high CUR as a sign of risk. Keeping it below 30% shows you manage credit wisely. This helps improve your credit profile and boosts your chances of getting loans easily.

To lower your credit utilisation ratio, try spending less on your credit card or cutting monthly expenses. Another option is to increase your credit limit while keeping your spending the same. Both ways reduce the share of credit you use each month. This helps bring your CUR down and strengthens your overall credit score.

Banks often offer eligible users a Credit Limit Enhancement (CLE) from time to time. Keep an eye on messages or alerts from your bank through email, SMS, or app notifications. Accepting this offer increases your credit limit instantly. This helps lower your credit utilisation ratio (CUR) without reducing your spending.

You can share your latest salary slips or income documents to request a higher credit limit, as higher income often qualifies for an increase. If you’re still not eligible, consider applying for a new credit card from another bank. This spreads your expenses across multiple cards. As a result, your overall utilisation goes down and your credit score improves.

If you don’t qualify for a regular credit card, choose a secured credit card linked to a fixed deposit. The card limit is usually 75–100% of your FD amount. It’s easy to get since the deposit acts as security for the bank. This option is ideal for first-time users or anyone looking to rebuild their credit history.

A higher credit limit helps lower your credit utilisation ratio (CUR) and boosts your credit score. It also increases your purchasing power for big-ticket expenses. You can earn more rewards and easily reach annual spend targets. Plus, it serves as a useful backup during financial emergencies.
Pro tip: Keep your CUR under 30%, pay bills on time, and review your limit regularly to keep your credit score strong.