7 Powerful Credit Score Hacks Every Indian Student Must Know

Why Credit Matters for Indian Students

Building a credit score as a student in India is crucial for future financial opportunities.

No matter if it’s applying for a loan, getting a flat in a metro city, or even applying for a job in the finance industry, your credit score plays a crucial role in shaping your financial status.

Many Indian students aren’t fully aware of how credit scores work, which is why it’s important to start building one early. Creating a credit history as a student isn’t just helpful; it’s a smart move for your future. Moreover, when it comes to managing finances, a good credit score can be a valuable guide for students.

Now, let’s explore how you can build your credit score in India the right way.

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Understanding Credit Scores in India

Let me get you the basics right.

What is a Credit Score?

A credit score is a three-digit number, typically ranging from 300 to 900. It reflects your overall creditworthiness and shows how reliable you are when it comes to borrowing money. This is calculated based on your credit activity and history, which in turn helps banks determine how safe it is to lend money to you.

In India, credit scores are provided by bureaus like-

Generally, a score above 750 is considered good. On the other hand, a score below 650 can make it more challenging to get credit cards or loans.

Why is a Credit Score Important for Students?

Renting Property: Various landlords in the metro city now go through the CIBIL Scores to rent properties to anyone.

Loan Approvals: Are you planning to study abroad or even start a business? Well, you should know that a good credit score leads to better loan chances.

Low interest rates: Additionally, with a higher credit score, you can enjoy the benefit of lower interest rates on credit products. As a result, you’ll end up paying less in the long run

Job Opportunities: Moreover, many employers, particularly in the finance industry, review credit history when hiring candidates. Therefore, it’s clear how crucial a good credit score is for students and their future opportunities.

Steps for Students to Establish Credit History

Even without a full-time job or large savings, you can still build your credit score. In fact, all it takes is making a few smart decisions along the way.

 1. Apply for a Student Credit Card or Secured Credit Card

Being a student yourself, your best bet is to start with :

Student credit cards: A student credit card, specifically designed for individuals with low income, is a great option. For instance, the SBI student credit card offers a helpful solution for students just starting to build their credit.

Secured Credit Cards: Such cards are issued against the FD. This is a perfect method if you do not have an earning source yet.

Example: As an instance, SBI, HDFC, and ICICI give out a secure card starting from an FD of Rs. 5000.

Pro Tip- It is advisable to use a credit card regularly for purchases like Netflix, Swiggy, and bills. Furthermore, make sure to pay the full amount before the due date. This not only helps in building a positive payment history but also plays a significant role, as payment history accounts for 35% of your credit score.

 2. Become an Authorised User on a Family Member’s Credit Card

Well, let me tell you, this is a hidden gem which is not known to many people. Get permission from your sibling or parent to add you as an authorised user on their credit card.

Let me show you how it helps:

📌You will not have to spend any money.

📌The credit score they maintain can also help increase yours. Additionally, it’s significant to stay cautious if they delay their payments, it could impact your score negatively. Therefore, always make certain to ask a trusted person to add you as an authorized user.

 3. Use BNPL (Buy Now, Pay Later) Responsibly

Certain apps like Zest Money, Lazy Pay, and Amazon Pay Later offer short-term credit.

Make use of these platforms for controlled spending, and always ensure you pay back before the due date. Since these platforms report to credit bureaus, they can be quite helpful in building your first credit file. However, it’s essential to remember not to overuse such options, as this can lead to unnecessary debt. Just a few small monthly transactions are well and good to make an effort.

4. Take a Small Education Loan and Repay on Time

My friend, if you are planning to fund your higher education or take any skill-based courses, applying for a small student loan is also a great option to build credit. For this, you need to

–>Pay the desired EMIs on time.

–>Do not miss any instalments.

—>Try to avoid any non-busy scheduling unless and until it’s very urgent.

A student loan of Rs. 50,000 to Rs. 1,00,000 can help you enhance your credit score if you know how to manage it right.

5. Always Pay Bills on Time- Even the Small Ones

Small unpaid bills are showcased as red flags in your pay history. It is always smart to set reminders or make use of auto-pay options to stay organised with:

📌Utility bills such as broadband or electricity.

📌Mobile bills, postpaid or prepaid.

📌EMI payments for anything, such as phones, laptops, etc.

Pro Tip- Make use of apps such as Mobikwik Zip, or CRED that help you in reminding and rewarding for on-time bill payments.

 6. Keep Your Credit Utilisation Ratio Low

Credit Utilisation Ratio is regarded as one of the important factors in a credit score. Think of your credit card limit like a ceiling. 

If your limit is ₹10,000, try not to go over ₹3,000 in spending each month. That’s about 30%. 

Why?

Because keeping your usage low shows lenders you’re not overly dependent on credit, and that can actually work in your favour when it comes to your credit score. It’s a simple habit that can make a big difference. This helps in outlining the lenders that you are a responsible cardholder and do not overly depend on credit.

 7. Monitor Your Credit Score Regularly

Most of the credit bureaus permit one free credit report per year. You can make use of apps such as:

One score

BankBazaar

CRED

PaisaBazaar

Look for:

🔸Wrong payment history 

🔸Name or address errors

🔸Unauthorised accounts

Report any issues on the spot to keep your overall history clean.

How to Get an 800 Credit Score in 45 Days

Do you want to form credit fast? Here is a simple plan that can help you:

WEEK 1-2

🔸Register application for a secured card (FD Backed)

🔸Make a purchase of around ₹500-₹1000

🔸Pay the full amount before the due date itself 

WEEK 3-4

🔸Become an authorised user on any of your parent’ or siblings’ cards

🔸Utilise BNPL for a small order (within ₹1000)

🔸Pay on time before the deadline hits

WEEK 5-6

🔸Repay all bills on time

🔸Utilise just 10-20% of your credit limit 

🔸Observe the credit report for updates

If you follow such steps properly, within the span of 45 days, you can see your score increasing to 750+, and in 3-6 months, it will hit 800.

Building Credit Without a Credit Card

Not ready for a card yet? Well, you can try these instead.

Virtual Credit: Platforms make use of Paytm Postpaid or LazyPay for small- to medium-sized transactions.

Credit Builder Loans: Certain fintech startups and NBFCs provide short-term loans to help you build a good credit score.

Paying Rent: Through Credit Platforms Services like RedGiraffe and NoBroker help in reporting your rent payments to the Bureaus. Such methods are, however, very powerful tools for building a credit score history early.

Avoid These Common Credit Mistakes

Even smart students can make mistakes sometimes, so it’s important to be cautious. To avoid falling into these traps, it’s best to stay aware and make thoughtful decisions.

❌Opting for too many credit cards at once

-This outlines desperation and brings in outcomes that can impact a score negatively.

❌Paying off only the minimum due 

-This can create debt and increase the overall interest. Always try to pay the full amount on time.

❌ Avoiding the credit report 

-Tiny errors can tank a score, so observing it quarterly is very important.

❌ Not having a credit account 

-No credit is as ugly as bad credit score. So, make use of at least one small account actively.

Bonus: Credit Score Tips for Indian Students Studying Abroad

Well, if you’re a student planning to move to the US, UK, or Canada for your studies, then this is something you definitely need to consider. Not only will it help you in the short term, but it can also set you up for long-term financial success. So, let’s take a closer look at what you can do.

🔸Start by building your Indian Credit now. It shows your maturity to lenders in foreign countries.

🔸Certain global banks check for your home country’s credit score at the time of ordering.

🔸Make use of International Student Credit Cards, like one of those which are offered by SBI Global or ICICI, to create history in both countries.

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Conclusion: Invest in Your Credit Future Today

Well, starting to build your credit as a student in India is an essential step in setting the foundation for a secure financial future. It’s not just about being able to take out loans later on; it’s also about building trust, demonstrating responsibility, and establishing your financial status. In fact, the earlier you begin, the easier it will be to navigate your financial life moving forward. Building a good credit score lays the groundwork for a financially stable future. But credit isn’t the only tool to achieve financial freedom. For example, passive income is another strategy that can supplement your regular earnings. To learn how you can start generating passive income, check out my detailed post on passive income opportunities.”

The earlier you start, the easier life gets later. Whether you are applying for a job, a car loan, or your first business credit line.

So, what’s the wait for? 

Start your credit journey today by applying for a student-friendly credit card, using it properly, and observing a score increase. My friend, your financial future starts now.

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FAQ

1. How do I build my credit score as a college student in India?

Answer:

To begin with, you can take your first step by getting an FD-backed secured credit card. Alternatively, even a simple student card can help you build your very first credit line. Once that’s done, your credit file with CIBIL will start taking shape. From there on, try making small monthly purchases, somewhere between ₹500 to ₹1,000 is more than enough. Most importantly, make sure to clear your dues on time. This way, you’re not just spending smartly, but also slowly building a solid credit score. Over time, these little habits can make a big difference.

2. Is it possible to build a credit score without a credit card?

Answer:
Of course, you don’t strictly need a credit card to start your credit-building journey. You can simply make use of rent reporting services. For example, RedGiraffe or NoBroker or else take small personal loans and pay EMI on time.

3. Which student credit card is best for a beginner?

Answer:
Some of the popular cards to start your journey include IDFC FIRST WOW credit Card, Kotak 811 #DreamDifferent, ICICI coral contactless, SBI student plus advantage, and Step UP. This card contains no annual fees and minimal eligibility requirements.

4. Will BNPL services like Amazon Pay Later help build my credit?

Answer:
Short-term BNPL (Buy Now, Pay Later) options like ZestMoney, Amazon Pay Later, or LazyPay can actually help too. Every now and then, these platforms report your repayment behavior to credit bureaus. So, if used wisely, they’re a great way to build your credit score little by little. Just remember, timely repayments are key — one late payment can undo all your good work. After 2-3 successful cycles, your bureau file gets formed, and your score starts to showcase your repayment pattern.

5. How can I reach a 750+ credit score quickly in India?

Answer:
Start with an FD secured credit card and keep your usage under 30%. Make certain that you make small, regular charges and pay them off fully with no delays. After you complete six months of flawless repayment history, apply for an unsecured card. Mix out credit types such as BNPL secured loans and an unsecured card, to showcase different responsible credit usage. After this, you can see a score of 750+ in 3 to 6 months.

6. I have no income, can I still build a credit score?

Answer:
Why not? even without any regular income, you can easily get authorised user access on a parent card or open a small FD and take an FD back secure card. You can use them for small recurring bills and pay in full each month. Moreover, setting up a rent reporting plan can work in your favor too. As long as you’re consistent and make your payments on time, with time it sends a favorable signal to credit bureaus. Eventually, this kind of slow and steady financial behaviour helps build a stronger, more reliable credit score without needing a credit card right away.