How to Build a Solid Credit Score from Scratch

Credit Score from Scratch:

If you’re new to credit and don’t have a credit score yet, don’t worry! Building a solid credit score from scratch is possible. Whether you’ve just started working or have never taken a loan or used a credit card, here are some effective ways to start your credit journey.

Credit Score from Scratch:

1. Get a Credit Card with Your Salary Account

Many banks offer credit cards to employees with salary accounts, even if they have no credit history. Some banks may issue a card after your first salary deposit, while others may wait a few months to observe your spending habits. Initially, you may receive a basic card with a small credit limit. By making regular payments on time, your credit limit could increase, and you might even get upgraded to a better card in the future.

2. Try a Secured Credit Card

If a regular credit card is not an option, consider applying for a secured credit card. This card requires you to create a fixed deposit (FD) with the bank as collateral. The credit limit is usually 75%-100% of the FD value, and you cannot withdraw the FD while the card is active. Using the card responsibly will help build your credit score, and over time, you can apply for regular cards once your score improves.

3. Buy Items on EMI

Another way to start building your credit history is by purchasing items through an EMI plan. Many banks and financial institutions offer short-term EMI plans for things like electronics or home appliances. Timely EMI payments will positively impact your credit score within a few months.

4. Use Buy Now, Pay Later (BNPL) Services

Several online platforms like Amazon Pay Later, Flipkart EMI, and Tata Pay Later offer BNPL services. Even if you have no credit score, they may approve you based on your regular shopping habits. Payments made on time are reported to credit bureaus, helping you build a credit score over time.

How Long Does It Take to Build a Credit Score?

By paying your bills and EMIs on time, you can start building a decent credit score within 6 months. Once you have a score, you’ll be eligible for more credit options, such as higher loans and better credit cards.

So, start small with a salary account card, secured card, or BNPL service. Always make timely payments. Within 6 months, you can establish a strong credit score for better financial opportunities.

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