Three ways to go from no credit to credit

Three ways to go from no credit to credit


This article is a contribution towards our financial literacy series. It has been written by a specialist in credit and debt counseling – Satish Mehta, Founder and Director of


fi_creditDid your loan application get rejected because you don’t have any credit history? Well, here’s how you can build your credit history in a healthy manner. Well, yes! It’s a cycle of credit and credit again!

As per two recent notifications by the Reserve Bank of India, all banks and other lenders need to take into account ‘Credit Information Reports’ (CIRs) from one or more agencies in all lending and account opening decisions. Also, a loan application should not be rejected just because the applicant has no credit history. So let’s get going and look at three ways to build your credit history:

1. Apply for a secured credit card:
A secured credit card is a credit card that is backed by a savings account, or by a deposit that is used as collateral on the credit available with the card. As you keep paying your outstanding dues on time, your good credit behaviour will be reported to credit bureaus, helping you build a good credit history.

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2. Become an authorized user:
Become an authorized user of a family member/spouse on one of his or her oldest credit card accounts. But do make sure this ‘someone’ repays his / her outstanding dues on time. After you have become an authorized user, you will have access to some form of credit. Once you do, make sure you do a 100 per cent payment of all your dues on time and don’t spend beyond what you can repay.

3. Check your credit score:
Do check your credit report for your latest score. For an individual with no credit history, or who does not have enough credit history, the score generated is ‘NA’ or ‘NH’ (CIBIL score). Typically, conservative lenders could view ‘NH’ negatively as per their credit policies of not lending to an individual who has no track record. On the other hand, an aggressive lender with a higher risk appetite could approve your credit application. Hence, look for lenders where you may have a better chance.

Hope you build your good credit history with time and continue doing so. Ensure that you do not apply randomly for credit facilities as this indicates a credit hungry behaviour. Remember, a high number of enquiries is viewed negatively by lending institutions.


Satish Mehta is the Founder and Director of – a credit and debt counselling company that provides end to end customized counselling to individuals by handholding them through their credit life cycle.

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