What exactly is a credit score in the UAE?
A three-digit number that represents your financial credibility to lenders as a result of an assessment of your financial records. This score assists lenders in determining how likely it is that they will be repaid on time if you are granted a loan or credit card. The higher the score, the better the chances of obtaining the card or loan on the most favourable terms.
Here’s how to achieve and maintain a good credit score in the UAE:
Prevent Negative Elements
After using your credit card to make payments, make sure to pay it back on time. Any delay in debt repayment, as well as situations such as bankruptcy or delinquency, can have a negative impact on your credit score.
Bill Payments on Time
Pay your bills on time. Payment delays reflect your inability to repay the debt and have a negative impact on your credit score. This also harms the credit history for future applications, making it difficult to obtain loans and credit cards. So, at all costs, avoid it.
Maintain a Clean Repayment Record
Maintain a clean repayment record beginning with your first credit card or loan. To track your repayment history, lenders look at your credit history, which contains all of your information. It includes every detail, from a single missed payment to any written-off debts. The better your credit score, the cleaner your record.
Don’t Use Your Credit Card to Its Limit
Maintain an optimal utilisation ratio and try not to exceed 30% of your total credit card limit. If the amount you need is more than 30%, try to use and then pay back as soon as possible, and if this happens frequently, ask your provider to increase your card limit.
