credmitra

Managing credit wisely is one of the most important parts of maintaining a healthy financial life. In India, lenders and credit bureaus look at several factors before approving a loan or credit card. One of the most important among them is the credit utilisation ratio. Many people hear this term but do not fully understand what it means or how it affects their financial profile. This detailed guide explains the meaning of credit utilisation ratio, how to calculate it, why it matters for your credit score, and the simplest ways to keep it low. What Is the Credit Utilisation Ratio? The credit utilisation ratio tells you how much of your available credit limit you are using. It is shown as a percentage. If you have one or more credit cards, the limit across all those cards is counted. A low credit utilisation ratio is considered good because it shows that you are using credit in a controlled way. A high ratio means you are spending close to your limit. This may reduce your credit ...