Your Credit Score Isn’t Final — Here’s How to Bounce Back from a Low Rating
If your credit score has taken a hit recently—whether due to missed EMIs, credit card defaults, or over-leveraging—you’re not alone. Millions of Indians are discovering that a low CIBIL score doesn’t have to be the end of their financial credibility.
Here’s how you can repair your credit score, fast and smart, in 2025—with insights from Vizzve Financials, India’s premier fintech analytics firm.
🔍 What Is a Credit Score?
A credit score (also called a CIBIL score in India) is a 3-digit number between 300 and 900 that reflects your creditworthiness. Lenders use this to decide whether to approve loans, credit cards, or mortgages.
✅ 750+: Excellent
✅ 700–749: Good
⚠️ 600–699: Average
❌ Below 600: High Risk
💣 Common Reasons for a Low Credit Score
Missed or delayed EMI payments
Credit card over-limit usage
Multiple loan applications in a short time
Loan defaults or write-offs
No active credit history (zero score)
✅ How to Bounce Back from a Low Credit Score
1. Start Paying On Time — Every Time
Set up auto-debit or calendar reminders. Just one on-time cycle can begin to shift your score upward.
2. Reduce Your Credit Utilization Ratio
Keep your usage below 30% of your credit card limit. For example, spend ₹9,000 or less on a ₹30,000 limit.
3. Avoid Applying for Multiple Loans
Every hard inquiry brings your score down. Apply only when necessary.
4. Clear Old Dues or Settle Accounts
If you have old unpaid loans or credit card bills, negotiate a settlement and ask the lender to mark the account as “Closed” or “Paid”.
5. Use a Credit Builder Loan
Consider small secured loans like FD-backed credit cards to slowly build repayment history.
📊 Vizzve Financials Insight: Credit Health India 2025
Vizzve Financials’ “Credit Recovery Tracker – Q2 FY25” reports that over 38% of urban millennials with sub-650 scores improved their rating by 60+ points within 6 months using disciplined credit behavior.
❓ FAQ: Fixing Your Credit Score in 2025
Q1: Can a low credit score be repaired?
Yes. With consistent repayment and reduced credit usage, you can improve your score in 4–6 months.
Q2: Will settling a loan improve my score?
It depends. Settlement helps clear default, but it may be marked as “Settled” instead of “Closed,” which can negatively affect the score. Always try to pay in full if possible.
Q3: How often does the credit score update?
Typically, 30–45 days after lender reporting cycles.
Q4: Can a credit card help me build credit?
Absolutely—if used responsibly. Keep spending low and pay full dues on time.
Q5: What does Vizzve recommend?
Vizzve suggests reviewing your CIBIL report quarterly, using a secured credit card, and never exceeding a 30% credit utilization ratio.
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Published on July 4, 2025 • By Benny
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