What is CUR, know how it affects your credit score

New Delhi. If you go to take a loan from the bank, then credit score is usually mentioned. Actually, Credit Score / CIBIL Score is an important parameter to measure the creditworthiness of a person to repay the loan. If your credit score is bad, then there is a lot of difficulty in getting a loan. If the credit score is good, then you can easily get a loan at a low interest rate. At the same time, Credit Utilization Ratio (CUR) has an impact on your credit score. Let us know what is credit utilization ratio

Credit Utilization Ratio ie CUR means that how much you use the credit limit of your credit card in a month. CUR has a lot to do with credit score. Your CUR depends on how much you use your credit card. The more you use the credit card, the higher will be your CUR.

For example, if you have a credit limit of Rs 2 lakh on your credit card. If you spend Rs 30,000 in this, then your CUR will be 15%. Credit utilization ratio increases due to higher utilization of credit limit. For a good credit score, it is always advised to keep the credit utilization ratio below 30%. This indicates that you are not much dependent on the credit card. If your CUR crosses the 30 per cent mark, your credit score may come down. It is advisable to increase the credit limit to maintain a low CUR.


FIRST PUBLISHED : June 10, 2023, 06:05 IST

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