A credit card loan is when your bank converts your outstanding balance or a portion of your credit limit into an EMI-based loan, usually at a lower interest rate than regular revolving credit.
While it offers relief during financial crunches, you must understand how it affects your CIBIL score — your financial reputation.
Negative Impacts on Your CIBIL Score
1. 📈 High Credit Utilization Ratio
Using a large portion of your card limit (above 30%) can lower your score.
Even if it’s converted into a loan, it reflects as high usage on your report.
2. 🔁 Multiple Loans Can Hurt Score
If you already have EMIs and then take a credit card loan, it increases your credit burden.
More loans = higher risk profile = lower CIBIL score.
3. 💰 Missed or Late Payments
One late EMI on a credit card loan can cause your score to drop by 50–100 points.
Timely payments are crucial.
Positive Impacts on Your CIBIL Score
1. 🧾 Timely EMI Payments Boost Score
If you pay your EMIs on time, it builds a positive repayment history.
Vizzve Finance recommends setting auto-debit to avoid delays.
2. 🛡️ Debt Consolidation Benefit
If used to pay off high-interest card dues, your score may improve over time as the risk decreases.
Structured EMIs are better than rolling debt.
3. 📊 Credit Mix Improves
Having a healthy mix of secured (like home loan) and unsecured (credit card loan) credit can enhance your score, if well-managed.
Vizzve Finance Tips to Use Credit Card Loans Wisely
✅ Borrow only what you need
✅ Keep credit usage under 30% of your total limit
✅ Never miss EMIs — use reminders or auto-pay
✅ Choose debt consolidation via personal loans if card interest is too high
🎯 Vizzve Finance offers instant personal loans to help you manage or clear credit card loans without damaging your CIBIL.
Final Takeaway
A credit card loan can either help or hurt your CIBIL score — depending entirely on how you manage it. Responsible borrowing, low credit usage, and timely repayments will keep your score healthy.
With Vizzve Finance, you get financial products designed to help you stay in control — not fall into debt traps.
❓ Frequently Asked Questions (FAQs)
Q1. Does taking a credit card loan lower my CIBIL score?
Not directly, but if your credit utilization goes up, your score may drop temporarily.
Q2. Will repaying my credit card loan on time improve my score?
Yes! Timely repayments build a strong credit history and boost your score.
Q3. How much credit usage is considered safe?
Try to keep it under 30% of your available credit limit.
Q4. Is a personal loan better than a credit card loan for my score?
Yes, personal loans often come with lower interest and may improve your credit mix.
Q5. Can Vizzve help me consolidate credit card loans?
Absolutely! Vizzve Finance offers low-interest personal loans to clear your high-cost card dues.
Published on : 22nd July
Published by : SMITA
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