How to close credit cards without hurting your CIBIL score ?

With department stores, buying department stores, and stores all offering lines of credit, it may be manner too easy to have a collection of credit cards with each card presenting a variety of rewards and cashback. That said, coping with a couple of credit score cards might not usually be possible and a person may don’t forget closing or cancelling a few of them to avert overspending.

While this could appear to be a clever move, it’s vital to take into account that closing a card also can effect your cibil.

How closing a credit card influences cibil score?

“That is because the credit card shows the amount of credit one can avail of. So, closing means you are actually reducing the amount of money available for spending,” said Rohit Garg, co-founder and chief executive officer, Smartcoin.
Also, when you have used best one credit card and also you need to cancel it, it may save you you from having a credit blend at the portfolio that’s one of the parameters in the cibil score calculation.
Any other important element is the repayment history, which decides the credit score. If you have a regularpayment records, preserving the account active can hold the account’s proper status. While you near a credit card account, you lose the available credit limit on that account. This makes the credit utilisation ratio (cur) or the percentage of the tavailable credit surge. And, this will show that you are the usage of a higher amount of available credit.

Close new cards first

For starters, ultimate the more recent credit cards first after which slowly moving to the older ones is a smart move, say professionals
“Closing a card that you have been using for a long time may result in a negative impact on the credit score. While using that old card, you might have made a timely payment which would have resulted in a positive CIBIL score. Cancelling that card will also delete the CIBIL score history and it will start afresh,” stated by Pranjal Kamra, CEO — Finology.

Remember the timing of closing cards

It is better to close the credit cards whilst you don’t have lots of credit card debt outstanding.
“Closing a credit card when you have a lot of other credit card debt will result in higher utilisation as the credit limit reduces with the same debt outstanding. Hence, it is advised to close a credit card when your credit card outstanding across all cards is the least which will have minimum impact on the credit score,” Anil K Pinapala, CEO, Vivifi said.

Check the cur and ask banks to increase on the remaining cards

This can be rectified by spending less on the existing card or asking the bank to increase the spending limit.

transfer to some other card

So one can retain the cibil, you may also switch your balance to any other credit card, and repay the amount at a lower interest fee.