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One day you check your credit score and it is 750. You feel reassured. Everything seems on track.
A few months later, you apply for a loan and suddenly, the lender tells you the credit score is 650. A 100-point drop. No warning. No clear explanation.
This is more common than people think. Small actions, missed details, or even habits you assumed were “okay” can quietly pull your score down. At the same time, some right moves actually help more than you realise.
To improve credit score outcomes in 2026, it’s important to know what’s working in your favour and what’s silently hurting it. That’s exactly what we’ll break down next.
5 Reason that Reduce Credit Score
Your credit score does not drop suddenly without a reason. In most cases, small habits build up quietly and reflect later when you apply for credit. Here are the 5 factors that help you stay prepared:
1. Missing or delaying loan and credit card payments
When you pay EMIs or credit card bills after the due date or skip them entirely, lenders see you as risky. Even a delay of a few days can hurt your score, and repeated delays cause bigger damage over time.
2. Using too much of your available credit limit
If you regularly use a large portion of your credit limit, it signals financial stress. For example, spending ₹45,000 on a ₹50,000 limit card shows high dependence on credit, which can pull your score down.
3. Applying for multiple loans or cards in a short time
Every loan or card application triggers a credit enquiry. Too many enquiries within a short period make it look like you are urgently seeking credit, which negatively impacts your score.
4. Having old unpaid dues or settled accounts
Unpaid loans or credit cards stay on your credit report for years. Even accounts marked as “settled” instead of “closed” suggest incomplete repayment and can continue to affect your score.
5. Not checking your credit report for errors or outdated information
Sometimes your credit report may show wrong data like loans you never took or payments marked late by mistake. If you do not review and correct these errors, your score may suffer unnecessarily.
Top 5 Factors that Improve Credit Score
A strong credit score is built through small, consistent habits rather than quick fixes. Here are the top 5 factors which helps improve your credit score:
1. Paying EMIs and credit card bills on time
Regular on-time payments show lenders that you are disciplined and reliable. This is the single most important factor to improve credit score, as it builds trust and reduces perceived risk over time.
2. Keeping credit utilisation low
Using only a small portion of your total credit limit works in your favour. Ideally, keeping usage below 30% shows you can manage credit comfortably without overdependence.
3. Maintaining a healthy mix of credit
Having a balance of secured loans (like home or auto loans) and unsecured credit (like credit cards) reflects responsible credit behaviour. It shows you can manage different types of borrowing.
4. Keeping old credit accounts active
Older accounts increase your credit history length, which lenders value. Even if you don’t use a card often, keeping it active with small spends and timely payments can support your score.
5. Regularly reviewing your credit report
Checking your credit report helps you spot errors, outdated entries, or incorrect late payments. Fixing these issues ensures your score reflects your actual credit behaviour, not mistakes in reporting.
How to Check Your Credit Score in a Simple Way?
One of the easiest ways to check your credit score is through google pay. Ensure Google Pay is installed and linked to your Indian phone number and bank account. Below are the 5 steps to credit score:
- Open the Google Pay app on your Android or iOS device.
- Scroll to the Manage your money section at the bottom.
- Tap Check your CIBIL score for free.
- Enter your full name (as on PAN), phone number, email (optional), and PAN (optional).
- Tap Continue and follow on-screen prompts to generate your report.
Key Takeaways to Improve Credit Score
- A credit score drop doesn’t happen overnight. Small habits quietly add up and show their impact later, often when you apply for a loan.
- A score you see on apps and the one lenders pull can differ due to timing, updates, or recent activity.
- Missed or delayed payments are the biggest reason scores fall, even short delays matter.
- High credit utilisation (using most of your limit) signals financial stress and hurts your score.
- Too many loan or card applications in a short span raise red flags due to multiple credit enquiries.
- Old unpaid dues or “settled” accounts continue to damage your profile long after the event.
- Errors in credit reports are common, and not checking them can cost you points unnecessarily.
- Improving your score is about consistency, not hacks, on-time payments and low utilisation matter most.
- A balanced credit mix and long credit history work in your favour over time.
- Regularly checking your credit score (for example, via Google Pay) helps you stay aware and fix issues early.
Frequently Asked Questions on Credit Score
What is the 2-2-2 credit rule?
The 2-2-2 rule is a healthy credit habit. It suggests using no more than 20% of your credit limit, paying dues 2 days before the due date, and avoiding more than 2 credit applications in a short period. This helps keep your credit profile stable.
Does income affect my credit score?
No. Your income is not directly included in your credit score calculation. However, income affects how comfortably you repay loans. If repayments are on time, your score improves indirectly.
What is a credit score?
A credit score is a 3-digit number (300–900) that shows how responsibly you manage credit. Lenders use it to decide loan approval, interest rates, and limits.
Can anyone have a 900 CIBIL score?
Technically yes, but it’s very rare. A 900 score requires a long credit history, zero missed payments, low credit usage, and consistent discipline over many years.
Can I improve my credit score quickly?
You can see small improvements within 2–3 months by paying dues on time and reducing credit usage. However, significant improvement takes time and consistent good habits.
Does checking my credit score multiple times reduce it?
No. Checking your own credit score is a soft inquiry and does not reduce your score, no matter how many times you check.
