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Increasing your chance of credit card approval

Alex Ritchie avatar
Alex Ritchie
- 5 min read
Increasing your chance of credit card approval

Whether you're a seasoned credit user or considering taking out your first credit card, gaining credit card approval can often be an uncertain process. 

This is particularly true during tough economic times, such as increasing inflation and high interest rates, as the banks may be more stringent with their risk assessments. The good news is that there are steps you can take to increase your chances of approval for a credit card.

Tips to increase your chance of credit card approval

1. Check your credit score

Your first step in boosting your chance of approval for a credit card is to check your credit history and credit score to know where you stand. 

Your credit score is a measurement of your creditworthiness, and tells issuers how reliable you could be as a customer. A credit score in the ‘Good’ to ‘Excellent’ categories will increase your chance of approval, as the higher your score, the lower your risk of late payment or default.

It’s not uncommon for mistakes to occur, such as having a family member’s credit history, or that of someone with the same name as you, applied to your credit file. If your score is lower than you expected, grab a copy of your credit report and go through it with a fine-tooth comb for errors. 

Further, being rejected for a credit card application can hurt your credit score. If your credit score has room for improvement, you also know ahead of time. It may be worthwhile boosting your credit history before you submit your application. 

2. Improve your credit score

You may be able to improve your credit score in the following ways:

  1. Pay off your existing debts, such as a car loan or outstanding credit card balance.
  2. Set up automated payments to avoid missing any repayments in the future.
  3. Make more than minimum repayments on your credit card.
  4. Avoid multiple credit applications at once.
  5. Use your existing credit cards well, as making regular, timely repayments demonstrates positive credit behaviour.
  6. Consider lowering your credit limits to avoid the temptation of overspending. 

3. Clear your debts

When a credit card issuer reviews your application, it will be assessing your ability to repay your credit card. Oftentimes providers will calculate this as if you had maxed out your requested credit limit. 

The issuer will look at key factors, like your income, expenses and any liabilities, to determine whether you can afford the credit card. If you already have one or more existing debts, it may be worthwhile paying these off first as a priority. The credit card issuer will subtract these debts from the income in your assessment, and if the provider thinks you cannot afford the new credit card, it will likely reject your application. 

4. Keep a stable income

Another key eligibility criterion for providers is your employment status. The issuer will look at your current role, your income, and the length of time you have been employed there, as part of its assessment of your application.

As a rule of thumb, issuers look for stability in your income, and may be likely to favour applicants that have left the probation period of a new role (employed more than 3-6 months). Being employed in a full-time position for over 12 months is typically considered the ideal situation for credit card approval.

If you’ve just started a new role - even if it pays more than your last - it may be worthwhile waiting until you’ve left your probation period before you apply for a new credit card. 

5. Choose cards that suit your financial situation

Just because a credit card has all the bells and whistles doesn’t mean it’ll be the best fit for your financial situation and budget. Platinum credit cards and rewards credit cards with generous perks typically come with more strict eligibility requirements, such as earning a higher income or meeting monthly spending limits.

If you’re likely to put yourself in debt just to gain approval for a new credit card, you may be better off choosing an option better suited to your needs. After all, if the provider does not think you can afford the card, your application will be rejected, which may hurt your credit score

It may be worthwhile instead considering a standard credit card, or opting for a lower credit limit, to improve your chance of approval. Some lower interest rate credit cards may come with fewer hoops to jump through, and may also benefit your budget by charging fewer ongoing fees. 

Applying for credit responsibly and working to improve your credit score over time may increase your chances of being approved for the credit card you want. 

Just keep in mind that there are no guarantees of approval. Different credit card issuers have different eligibility criteria, so it's worthwhile reading the terms and conditions of a credit card before you apply. 

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Product database updated 20 May, 2024

This article was reviewed by Personal Finance Editor Mark Bristow before it was published as part of RateCity's Fact Check process.