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How Can You Build Credit Score Without Taking a Credit Card?

Published on Nov 29, 2022Updated on May 21, 2024

How Can You Build Credit Score Without Taking a Credit Card?

A credit score is of utmost importance when you have to prove your financial stability and creditworthiness to a lending institution. This situation usually arises when you apply for a loan and have to prove that you can repay the loan amount back within time, without default. But the most common misconception around a credit score is that you need a credit card in use for it. But how to build credit without a credit card?

If you wish to build credit without a credit card, you can turn to loan options. Be it a personal loan for marriage or a personal loan for home renovation, you can borrow a certain amount of money and repay it within time to boost your credit score. Read along to know more about loan options for building credit.

4 Effective Options to Build Credit:

You can consider the following methods of boosting your credit score without a credit card:

1. Personal Loan

Taking up a personal loan is the easiest way to improve your credit score. All you have to do is ensure that you repay the Equated Monthly Instalments (EMIs) well within the deadline every month. When you eventually pay back the entire loan amount, your credit score will increase. The only point to remember here is that your interest rate will depend on your existing credit score for a personal loan. Hence, boosting it now will mean lower interest rates in the future.

2. Car Loan

One of the most common signs of personal or professional growth in India is buying a car. You can take this purchase as an opportunity to enhance your creditworthiness. Instead of buying your new automobile in cash, opt for a minimum personal loan such that you can adhere to the repayment schedule in a disciplined manner.

3. Existing Loan

If you already have taken up a personal loan for a cause like supporting your child’s higher education, buying a new phone, arranging for a wedding, planning for a family vacation, or upgrading your home, then you must focus on consistently paying back your EMIs to the lending institution. Always keep in mind that your debt-to-income ratio must be maintained below a solid 30% for healthy credit score management. To make it easy for you to organise your finances, make sure that you fall into the habit of inculcating your EMI system into your monthly salary and savings system. This way, you will put your EMI repayment requirements above your personal expenses if not necessary.

4. Utility Payments

Having long-overdue bills and failing to pay them on time could hurt your credit score. Your recurring bills should be well-tended, as it can make a difference. Generally, such utility payments have no direct impact on your credit report, however, if you miss out on your payments, your account could be sent to collection agencies who report to credit bureaus, eventually hampering your credit score and credit worthiness.

Personal Loan Details You Need To Know

The best kind of personal loans are that which give you the financial security that you need and don’t make it tough for you to manage your repayments. Here are a few features to look out for when you apply for an instant personal loan:

  • High loan amount bracket, going up to even INR 25 lakhs*
  • Comfortable tenures, going up to even 60 months
  • Affordable interest rates, starting at only 11.99%* per annum

With such useful personal loan facilities, you can boost your credit score without a credit card easily. Only, keep in mind that you must regularly check your credit score so as to not overshoot your debt limit.


Your credit score depends upon a number of factors like repayment history, total defaults, debt-to-income ratio, past borrowing, timeliness, etc. The best way to build your credit score without taking a credit card is to make repayments as promised and let minimum debt add on to your finances.

If you’re looking to take up a personal loan, you should apply for an instant personal loan under SMFG India Credit. The application process is 100% online. You will receive your funds within 30 minutes* after final loan approval and can utilise the money immediately. Check out our personal loan interest rates and determine your EMI obligation through our online Personal EMI calculator. Start improving your credit score today!

* Please note that this article is for your knowledge only. Loans are disbursed at the sole discretion of SMFG India Credit. Final approval, loan terms, disbursal process, foreclosure charges and foreclosure process will be subject to SMFG India Credit's policy at the time of loan application. If you wish to know more about our products and services, please contact us

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