Credit Utilization Ratio Calculator
Credit Cards Details
Status: Good / Healthy
Your utilization is in the recommended 10% - 30% range. This shows responsible credit behavior to lenders.
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Credit Utilization Ratio Formula
Finds the portion of your total credit limits currently utilized, advising on score thresholds (maintain < 30%).
Worked Example: Outstanding balance of ₹45,000 across cards with total limit of ₹1,50,000
Credit Utilization: The key metric for maintaining a high credit score
Amit had a total credit limit of ₹1.5 Lakhs across his cards. He frequently utilized ₹1.2 Lakhs (80%) of his limit, always paying the bills on time. He was surprised to find his CIBIL score dropping despite zero payment delays.
He learned that lenders track the Credit Utilization Ratio (CUR). Utilizing over 50% of your limit flags you as 'credit hungry' and lowers your score. By shifting some purchases to debit and requesting a limit increase, Amit brought his utilization down to 30% (₹45,000), restoring his credit score.
Credit utilization measures the ratio of outstanding debt to your total available credit limit. Maintaining it under 30% indicates low risk to lenders.
Keep your credit utilization low by paying balances mid-cycle or utilizing multiple cards. Never close old cards, as they maintain your overall credit limit.
Frequently Asked Questions
What is Credit Utilization Ratio?
It is the percentage of your total available credit limit that you are utilizing across all credit cards. For example, using ₹30,000 of a ₹1 Lakh limit means a 30% utilization ratio.
What is a good Credit Utilization Ratio?
A ratio under 30% is considered healthy. Utilizing more than 30% flags you as high-risk or credit-hungry to credit bureaus, causing your CIBIL score to decline.
Does paying off credit card balances early help?
Yes. Paying your card balances before the bank reports them to the credit bureau (usually on your statement generation date) keeps your reported credit utilization low.
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