How to improve your credit score from 600 to 750 with smart financial habits and better credit management

A credit score is like a financial report card. It is a three-digit number issued by leading credit bureaus in the country. This is a number that can improve your chances of securing personal loans, home loans, credit cards, and other forms of debt at lower interest rates and flexible terms.

A high credit score can also strengthen your credit profile and boost your creditworthiness. Now, it is a given that moving from a credit score of 600 to 750 may seem a little challenging; still, experts suggest it is achievable through dedicated financial management and disciplined credit habits. There are no shortcuts to achieving such progress.

Subhankar Mishra, Interim MD for Equifax Credit Information, explained this concept in detail, stating, "Elevating your score from 600 to 750 requires active credit management. Accelerate this by ensuring timely repayments, keeping utilisation prudent, and maintaining a healthy balance of secured and unsecured credit lines. Avoid rapidly accumulating multiple credit lines, let older accounts mature, and crucially, scrutinise credit reports for demographic errors that might mistakenly tag another person's liabilities to your profile.”

Anup Agarwal, Co-founder of Kiwi, further added to this, stating, “A good credit score isn't built overnight, it's earned through consistent habits, not quick fixes. Pay your credit bills in full, every time. Use less of your credit limit than you're given. And don't apply for too many cards too quickly. Do this consistently, and your score as well as your access to better credit will take care of itself.”

Keeping these core aspects of meaningful debt management in mind, here are five smart ways to boost your credit score:

5 smart ways to build a strong credit score

1. Pay on time, every time: Your repayment history has the biggest impact on your credit score. Always pay EMIs and credit card bills on time to build a strong credit profile.

2. Keep credit utilisation low: Make sure that you never use more than 30% of your available credit limit. The lower the utilisation, the better. Low utilisation reflects responsible borrowing and helps keep the credit score steady.

3. Maintain a balanced credit mix: A healthy mix of secured and unsecured credit demonstrates your ability to manage different forms of debt properly. This means trying to repay your borrowed funds through credit cards, personal loans, and home loans without delay and demonstrating effective management of all forms of debt.

4. Avoid multiple credit applications: Ensure that you do not project yourself as ‘credit hungry’; this can be projected if you send frequent loan or credit card applications. Such behaviour can trigger hard inquiries, which can lower your credit score. Apply for a new loan or credit card only when absolutely necessary.

5. Review your credit report regularly: Check your credit report for any mistakes, omissions, errors, outdated information, or incorrect liabilities. Promptly correcting inaccuracies can help protect your credit score.

In summary, credit scores in the country are provided by prominent credit bureaus such as TransUnion CIBIL, Equifax, Experian and CRIF High Mark. Now, improving your credit score from 600 to 750 isn't something that can be achieved in a very short period of time. It is a gradual process that demands patience.

By making on-time payments, utilising credit responsibly, limiting unnecessary borrowing and keeping a close watch on your credit report, you can steadily build a reputable financial profile. This is the best possible way to improve your credit score from 600 to 750 or even higher.