Maintaining a good credit score is challenging, but it’s possible even without a credit card. Here are five effective strategies:
1. Take Out a Small Loan
Secure a small loan from a bank or NBFC and repay it on time to positively impact your credit score. Missed payments can hurt your score, so borrow wisely.
2. Become an Authorized User
Join a trusted person’s credit account as an authorized user to benefit from their positive credit actions. However, their missed payments could affect your score.
3. Apply for a Secured Credit Card
A secured credit card, backed by a fixed deposit, helps build credit with timely payments. This can lead to qualifying for an unsecured card in the future.
4. Report Your Rent Payments
Ensure your rent payments are reported to credit bureaus by your landlord. This can add positive activity to your credit history.
5. Consider Peer-to-Peer Lending
P2P loans can help build credit if traditional lenders aren’t an option. These loans often report to credit bureaus but come with higher interest rates, so borrow carefully.
Use these methods to strengthen your credit score without relying on a credit card.