What Should You Do if Your Credit Card Application Gets Rejected?

Posted on Tuesday, August 27th, 2024 | By IndusInd Bank

Imagine you’ve carefully filled out a credit card application, submitted all necessary documents, and eagerly await your approval. But then, the unthinkable happens—your credit card application gets rejected. It is a frustrating experience, leaving you questioning where you went wrong. Many face this scenario, and it is essential to understand why this happens and how to navigate it. This blog will guide you through what your next steps should be after this. This can help you improve your chances next time so you wouldn’t have to wonder, “why did my credit card application got declined”.

Understand the Reasons Behind Rejection

When your credit card application gets denied, it’s crucial to identify the reasons. Here are some common causes:

• Poor Credit History: Lenders check your credit history to gauge your creditworthiness. A low credit score can be a red flag.
• Insufficient Income: Credit card issuers require a specified minimum income level. This ensures you can repay the credit. Falling short of this requirement can lead to rejection.
• Existing Debt: Existing debt, which is high relative to your income, can cause troubles. It can make lenders hesitant to extend more credit.
• Faulty Application: Maybe your credit card application got declined because of missing or incorrect information in your application.  

Review Your Credit Report

After facing a rejection, review your credit report for errors or issues. You can get a free credit report from credit bureaus. Look for inaccuracies or old information that can negatively impact your score. If you find errors, report them immediately to get them corrected. Monitoring your credit report helps you stay on top of your financial health.

Improve Your Credit Score

If poor credit history is the reason for rejection, take steps to improve your credit score:

• Timely Payments: Pay your bills on time to build a positive payment history.
• Reduce Debt: Lower your existing debt levels to improve your credit utilisation ratio.
• Limit Credit Inquiries: Do not apply for multiple credit cards or loans in a short period.

Consider a Secured Credit Card

A secured credit card is an excellent option if your application was declined because of a poor credit history. A secured credit card requires a fixed deposit as collateral. This makes it less risky for the lender. Using a secured card responsibly can help rebuild your credit score. It also can make you eligible for an unsecured credit card in the future.

Ensure Accurate and Complete Applications

Double-check your application before submitting it. Ensure all information is accurate and complete. Missing details or incorrect information leads to an automatic rejection. Provide all necessary documents and ensure they are up to date.

Evaluate Your Income and Expenses

If your application was declined because of insufficient income, evaluate your financial situation. Look for ways to increase your income or reduce expenses. Demonstrating a stable and sufficient income can improve your chances of approval.

Reapply Strategically

After addressing the issues that led to your rejection, consider reapplying. But don’t rush into it. Focus on improving your credit score and financial situation. When reapplying, choose a card that aligns with your credit profile and needs.

Explore Alternative Options

If your requests for credit cards are declined by VISA and MasterCard, explore alternatives like RuPay credit cards. RuPay cards offer similar benefits and are widely accepted across India. IndusInd Bank provides a RuPay credit card called the IndusInd Bank Platinum RuPay Credit card. This card can be a stepping stone to building your credit history.

Also Read: People with a Low CIBIL Score Can Still Get a Credit Card: Here’s How

Conclusion

Facing a rejected credit card application can be disheartening, but it isn’t the end of the road. If you understand the reasons behind the rejection, take corrective measures. This can improve your chances of approval in the future. Monitor your credit report, maintain a healthy credit score, and take other steps to improve your chances. Don’t let a rejection deter you—take control of your financial future today!

Looking for a credit card tailored to your needs? Consider exploring IndusInd Bank’s credit cards. From secured credit cards to RuPay cards, IndusInd Bank has a variety of options designed to meet your financial requirements.

Apply now and learn more about IndusInd Bank Credit Cards and find the perfect card for you.

Disclaimer:
The information provided in this article is generic and for informational purposes only. It is not a substitute for specific advice in your circumstances. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for making any financial decisions based on the contents and information.