We all know about credit card benefits and how you can maximize them by using simple tips but before all that the primary step to unlock these lucrative privileges is to get a credit card. To obtain a credit card, one needs to drop a request with the credit card issuer and there are high chances of its rejection if you do not stay clear of certain activities at the time of making the request.
Let us discuss some of the most important reasons why is your credit card application rejected:
- Poor Credit Score: A credit score is an indication of a person’s creditworthiness. It is calculated using a person’s credit history, bill payment, error in cibil report, etc. A poor credit score is one of the main reasons why your application can be rejected by a bank because it increases the risk factor for the bank to issue a credit card to a person with poor or bad credit history.
- Low income: There is a minimum income criterion to apply for any specific credit card. A basic or mid-segment level credit card has a comparatively lower income limit than a premium credit card. If your income goes below the limit set by the credit card issuer for the card you are applying for then there are high chances that your application will be rejected.
- Multiple credit card inquiries: If at the time of requesting a credit card you have also dropped queries at multiple credit card issuing organizations then that is an indicator of your poor financial state. Since the bank undergoes a background check of the applicant where it check credit card application status with other banks as well, it tends to know which candidate has dropped multiple inquiries in a short period. One should try to avoid dropping multiple queries within a short period to increase the chances of credit card application acceptance.
- Documentation & Application error: While making an application with a credit card issuer, the candidate is asked to upload several documents like address proof, income proof, etc. If there is an error in the documents submitted then it increases the chances of rejection. Similarly, if you have made an error in the application form then that can also increase your rejection probability.
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- High loan balances: You may already have considerable loans, such as a personal loan, an auto loan or a housing loan, etc. If this is the circumstance, the bank may be reluctant to approve your application since it brings up questions about your potential to pay your credit card bills on time.
- Age, employment & nationality: There are certain eligibility criteria for every credit card like age, employment status, minimum income, nationality, etc. All these must be aligned with the minimum requirements to avoid being your credit card application rejected. You should check your credit card application status regularly to spot errors (if any) and get them rectified as soon as possible.
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