Why my SBI Credit Card Application was declined every time.

[sudhakarcool]

Hi Experts,

I am a newbie here, so I am sorry if I do something strange; please pardon me.

This post is regarding the decline of the SBI card every time I applied for it.

I have almost every bank credit card instead of Amex and SBI.

I have 18 active credit cards with me, of which almost all are lifetime-free. Hence, I am continuing them.

Due to deals and offers of SBI cards on Amazon, I am keen to have an SBI card, but every time I apply for any version of an SBI card, the application says "Declined."

The bank provides no clear information for making the card declined, so I am unsure what is going wrong there.

Can someone help me here? Thank you very much for your time here.

 

[TaxWiser]

Hi Experts,

I am a newbie here, so I am sorry if I do something strange; please pardon me.

This post is regarding the decline of the SBI card every time I applied for it.

I have almost every bank credit card instead of Amex and SBI.

I have 18 active credit cards with me, of which almost all are lifetime-free. Hence, I am continuing them.

Due to deals and offers of SBI cards on Amazon, I am keen to have an SBI card, but every time I apply for any version of an SBI card, the application says "Declined."

The bank provides no clear information for making the card declined, so I am unsure what is going wrong there.

Can someone help me here? Thank you very much for your time here.

It might be because your total credit limit is greater than your income or Poor Credit Mix

 

[sudhakarcool]

It might be because your total credit limit is greater than your income or Poor Credit Mix

No Sir,

Thank you for your reply!
My CIBIL is 780+, and my salary is enough for any SBI card eligibility. Still not sure the reason? how can I know the reason?

 

[TaxWiser]

No Sir,

Thank you for your reply!
My CIBIL is 780+, and my salary is enough for any SBI card eligibility. Still not sure the reason? how can I know the reason?

Sir, Looks like you didn’t get my point. I was not talking about salary eligibility.

Here is a more refined and detailed explanation using Gemini AI regarding the same:

Total Credit Limit Greater Than Income​

This means that the combined credit limits of all your credit cards and loans exceed your annual income. Lenders might see this as a risk because it suggests you have access to more credit than you can reasonably repay based on your income.​

​

Example:​

- Annual Income: ₹5,00,000​

- Total Credit Limit: ₹6,00,000 (across all credit cards and loans)​

​

In this case, your total credit limit (₹6,00,000) is greater than your annual income (₹5,00,000), which might make lenders hesitant to offer you additional credit.​

​

Poor Credit Mix​

A poor credit mix refers to having a limited variety of credit types. Lenders prefer to see a mix of credit accounts, such as credit cards, installment loans (like car loans or personal loans), and mortgages. This shows that you can manage different types of credit responsibly.​

​

Example:​

- Credit Mix: Only credit cards​

​

If you only have credit cards and no other types of credit accounts, lenders might view this as a poor credit mix. They prefer to see a combination of revolving credit (like credit cards) and installment credit (like loans).​

​

Combined Example​

Imagine you have an annual income of ₹5,00,000, and you have the following credit accounts:​

- Credit Card 1: ₹2,00,000 limit​

- Credit Card 2: ₹1,50,000 limit​

- Personal Loan: ₹2,50,000 limit​

​

Your total credit limit is ₹6,00,000, which is greater than your income. Additionally, if you only have credit cards and a personal loan, but no other types of credit, this could be seen as a poor credit mix.​

​

By addressing these issues, such as reducing your total credit limit or diversifying your credit mix, you can improve your creditworthiness in the eyes of lenders.​

Hope this helps

 

[sudhakarcool]

Sir, Looks like you didn’t get my point. I was not talking about salary eligibility.

Here is a more refined and detailed explanation using Gemini AI regarding the same:

Total Credit Limit Greater Than Income​

This means that the combined credit limits of all your credit cards and loans exceed your annual income. Lenders might see this as a risk because it suggests you have access to more credit than you can reasonably repay based on your income.​

​

Example:​

- Annual Income: ₹5,00,000​

- Total Credit Limit: ₹6,00,000 (across all credit cards and loans)​

​

In this case, your total credit limit (₹6,00,000) is greater than your annual income (₹5,00,000), which might make lenders hesitant to offer you additional credit.​

​

Poor Credit Mix​

A poor credit mix refers to having a limited variety of credit types. Lenders prefer to see a mix of credit accounts, such as credit cards, installment loans (like car loans or personal loans), and mortgages. This shows that you can manage different types of credit responsibly.​

​

Example:​

- Credit Mix: Only credit cards​

​

If you only have credit cards and no other types of credit accounts, lenders might view this as a poor credit mix. They prefer to see a combination of revolving credit (like credit cards) and installment credit (like loans).​

​

Combined Example​

Imagine you have an annual income of ₹5,00,000, and you have the following credit accounts:​

- Credit Card 1: ₹2,00,000 limit​

- Credit Card 2: ₹1,50,000 limit​

- Personal Loan: ₹2,50,000 limit​

​

Your total credit limit is ₹6,00,000, which is greater than your income. Additionally, if you only have credit cards and a personal loan, but no other types of credit, this could be seen as a poor credit mix.​

​

By addressing these issues, such as reducing your total credit limit or diversifying your credit mix, you can improve your creditworthiness in the eyes of lenders.​

Hope this helps

Thank you, sir, for the detailed answer. I still have doubts about how to recover from this type of issue.

Do I have to close my credit cards even though they are free for life or something else? What are your conclusions on this as a matter expert?

For more help, I have an 11L car loan from SBI. Also, I have a home loan of 18L from HDFC Bank.

Maybe the above info can help you understand the issues. Thank you very much for your help, sir. I am unable to post my salary here; sorry for this, sir.

 

[TaxWiser]

Thank you, sir, for the detailed answer. I still have doubts about how to recover from this type of issue.

Do I have to close my credit cards even though they are free for life or something else? What are your conclusions on this as a matter expert?

For more help, I have an 11L car loan from SBI. Also, I have a home loan of 18L from HDFC Bank.

Maybe the above info can help you understand the issues. Thank you very much for your help, sir. I am unable to post my salary here; sorry for this, sir.

The aforementioned thoughts are my assumptions regarding your issue. If these assumptions are the core reason behind your issue, here are some steps you can take to manage this situation effectively:

Steps to Manage High Credit Limit​

1. Reduce Credit Utilization:​

• Keep Balances Low: Try to keep your credit card balances low relative to your credit limits. Aim for a credit utilization ratio below 30%.
• Pay Down Balances: If possible, pay down your existing credit card balances to reduce your overall debt.

2. Request Credit Limit Reduction:​

• Voluntary Reduction: You can request your credit card issuers to reduce your credit limits. This can help align your total credit limit more closely with your income. However, be cautious as this might increase your credit utilization ratio if you have existing balances.

3. Avoid New Credit Applications:​

• Limit New Credit: Avoid applying for new credit cards or loans, as this can further increase your total credit limit and lead to hard inquiries on your credit report.

4. Focus on Timely Payments: ​

• Consistent Payments: Ensure you make all your payments on time. This will help improve your credit score over time and show lenders that you are a responsible borrower.

​

Considering Your Loans​

Given that you have an 11L car loan from SBI and an 18L home loan from HDFC Bank, it's important to manage these loans effectively:​

• Car Loan: Continue making timely payments. If possible, consider making extra payments to reduce the principal faster.
• Home Loan: Similarly, ensure timely payments and consider extra payments if feasible.

Conclusion​

While having a high total credit limit compared to your income can be a concern, managing your credit responsibly can mitigate potential issues. Focus on reducing your credit utilization, making timely payments, and avoiding new credit applications.​

​

(Source: Conversation with Gemini AI)

My personal recommendation is to apply for your new desired credit cards in your parent's, sibling's, or spouse’s name. This way, it won’t impact your credit report, fulfilling your requirements and might help improve their credit scores. In the future, this can make it more convenient and cost-effective to get loans (as co-applicants) and credit cards.

Best of Luck

 

[sudhakarcool]

The aforementioned thoughts are my assumptions regarding your issue. If these assumptions are the core reason behind your issue, here are some steps you can take to manage this situation effectively:

Steps to Manage High Credit Limit​

1. Reduce Credit Utilization:​

• Keep Balances Low: Try to keep your credit card balances low relative to your credit limits. Aim for a credit utilization ratio below 30%.
• Pay Down Balances: If possible, pay down your existing credit card balances to reduce your overall debt.

2. Request Credit Limit Reduction:​

• Voluntary Reduction: You can request your credit card issuers to reduce your credit limits. This can help align your total credit limit more closely with your income. However, be cautious as this might increase your credit utilization ratio if you have existing balances.

3. Avoid New Credit Applications:​

• Limit New Credit: Avoid applying for new credit cards or loans, as this can further increase your total credit limit and lead to hard inquiries on your credit report.

4. Focus on Timely Payments: ​

• Consistent Payments: Ensure you make all your payments on time. This will help improve your credit score over time and show lenders that you are a responsible borrower.

​

Considering Your Loans​

Given that you have an 11L car loan from SBI and an 18L home loan from HDFC Bank, it's important to manage these loans effectively:​

• Car Loan: Continue making timely payments. If possible, consider making extra payments to reduce the principal faster.
• Home Loan: Similarly, ensure timely payments and consider extra payments if feasible.

Conclusion​

While having a high total credit limit compared to your income can be a concern, managing your credit responsibly can mitigate potential issues. Focus on reducing your credit utilization, making timely payments, and avoiding new credit applications.​

​

(Source: Conversation with Gemini AI)

My personal recommendation is to apply for your new desired credit cards in your parent's, sibling's, or spouse’s name. This way, it won’t impact your credit report, fulfilling your requirements and might help improve their credit scores. In the future, this can make it more convenient and cost-effective to get loans (as co-applicants) and credit cards.

Best of Luck

Thank you, sir, for your suggestions. I will work on your suggestions.