1. Regularly Review Your Credit Report
- Understand Your Report: It details all your credit activities, including your payment timeliness.
- Check for Errors: Use platforms like Moneycontrol to access your credit report for free.
- Rectify Discrepancies: If you spot inaccuracies, contact the relevant authorities for corrections.
2. Pay Your Bills on Time
- Be Consistent: Timely payments show reliability and positively impact your credit score.
- Set Up Reminders: Use phone or calendar reminders for due dates.
- Automate Payments: Set up autopay for the minimum amount due or the entire bill to ensure timely payments.
- Prioritize Repayments: Focus on paying off credit card bills and loan EMIs first.
3. Reduce Outstanding Debt
- Create a Budget: Track your expenses with a monthly budget to avoid overspending.
- Pay Off High-Interest Debt: Concentrate on clearing high-interest bills first.
- Negotiate with Creditors: Discuss lower interest rates or better payment terms.
4. Avoid Late Payments
- Review Statements Periodically: Stay aware of all due dates by checking your credit account regularly.
- Use Payment Tools: Tools like auto-pay or third-party apps can help manage your payments.
- Communicate with Creditors: Discuss potential relief options if facing financial difficulties.
5. Keep an Eye on Credit Utilisation
- Maintain Low Utilisation: Aim to use less than 30% of your approved credit limit.
- Raise Credit Limits: Request an increase in your credit limit if possible to improve your utilisation ratio.
- Pay Balances Early: Pay off balances before statements are generated to lower reported amounts.
6. Address Negative Marks on Your Credit Report
- Rebuild Gradually: Prioritise good credit habits to recover from past mistakes.
- Request Goodwill Adjustments: If a one-time event caused a missed payment, ask your creditor for leniency.
- Negotiate Settlements: If accounts are in default, negotiate to have them marked as ‘settled’ or ‘paid.’
7. Use Credit Responsibly
- Apply Wisely: Avoid frequent credit applications, as they can negatively impact your credit history.
- Monitor Your Credit: Regularly check your credit report and score to catch potential issues early.
- Stay Educated: Learn about credit management practices to maintain a strong credit history.