You recently had your most recent application for a credit card declined, are you hurt? A large number of credit card applications—perhaps thousands—are rejected every day, so don't take it personally. Your chances of getting a credit card aren't always bleak just because one bank rejects your application.
If you want to raise your credit score, you might need to adjust your lifestyle or you might be applying for the wrong kind of card. Following that, here are 7 possible explanations for the denial of your most recent credit card application.
1) The application form was incorrectly completed by you
Don't laugh; mistakes happen to everyone occasionally, making this hypothetical situation quite plausible. Let's just state that if you omitted to fill out or put down certain information improperly, the Bank will be unable to execute your application. This is especially true if the data is essential, such as your NRIC number. It is always advisable to carefully verify all of your information before submitting any form in order to prevent making this easy, and occasionally hilarious, mistake.
2) This Is Your First Time Borrowing
Applying for credit with no credit history at all could impede your application, however it wouldn't be quite as terrible as having bad credit history. Lenders prefer to see evidence of your past responsible debt management because it gives them confidence that you will pay back your debts on time, even if you fulfil all the requirements. This problem gets worse if you decide to apply for a more "advanced" credit card as your first card.
3) Your work experience is insufficient.
Only those who have recently graduated from college, i.e., those who haven't been employed for a very long period, are typically affected by this cause. The majority of banks typically demand a minimum working time period (with EPF contribution) of at least 6 months with the same firm in order for your credit card application to be granted, supposing all other requirements are completed.
Given that most employees receive confirmation of their employment before their six-month mark with a given employer, this condition is frequently put in place to demonstrate that the cardholder has a steady source of income.
4) Your current credit card bills have not been paid on time.
The bank essentially runs a credit check on you whenever you apply for a new credit card by scanning the entirety of your past financial transactions. The bank will want to look at your history with those cards whether you currently have any or have ever had any. If you already have a credit card and have been paying off all of your purchases by the due date in order to maintain a low amount, for instance, the bank should have no trouble providing you another card.
The bank might be less likely to offer you a second card, on the other hand, if you haven't been paying your debts on time, have started accruing a lot of interest, or had your card cancelled for non-payment. To increase your chances of being approved for a credit card, it is therefore crucial to try to pay down your debt before applying. Do not forget that your chances of being approved are decreased the more debt you have.
5) In the Past, You Have Been Caught Fraudulent
"Once convicted, never forgotten" is the adage that applies to crimes in general. Your criminal history follows you for the rest of your life and can affect applications for anything, including credit cards and jobs. This last statement is particularly accurate when financial fraud is the crime at hand. For example, tax evasion and forgeries are instances of monetary fraud, which is officially defined as illegal deception used for financial advantage.
A flaw like fraud on your record can drastically lower the bank's confidence in you, which may cause them to decline to provide you a credit card.
6) You Own Too Many Credit Cards.
It's simple to just go crazy applying for any credit card you see because there are so many different credit cards with different rewards available on the market. After all, there is no such thing as having too many cards. Wrong! If a potential cardholder has five or more or a significant number of current cards, most banks may be less likely to issue new cards to them.
You shouldn't anticipate that your fifth or sixth credit card application will be accepted unless you earn a sizable amount of money each year and have a perfect credit history.
7) You submitted too many credit card applications all at once
This is especially true while attending exhibition fairs, where hordes of credit card booths wait for unaware visitors in an effort to lure them into applying for a credit card. The likelihood that all of your applications will be accepted slowly decreases as you move from booth to booth applying for card after card.
As previously said, if you apply for a new credit card, credit card firms typically check absolutely everything about you. In light of this, the bank may be less likely to approve your requests if they discover that you are applying for multiple cards at once.
