Can’t seem to get approved for a new credit card or loan? There are a lot of factors that influence bank approvals—credit score being one of the biggest. If you can’t seem to figure out why your application keeps on getting declined despite having met all necessary requirements, then a poor credit score might be to blame. Before anything else, what is credit score and credit history anyway? Think of your credit score and credit history like your grade and your report card back in high school. When you apply to college, you’re required to submit your high school transcript to all the universities you apply to. A credit score is kind of like your GWA–except instead of displaying your academic competence, it estimates your creditworthiness with one numerical value. Your credit history, which is a blow-by-blow display of your payment behavior, is one component of your credit report. In a nutshell, it’s the account of how you’ve used your credit cards and paid off your loans over the years. Your credit score says a lot about you–it shows your payment habits and your responsibility in repaying your debts. More importantly, it gives banks a good impression on whether or not you know how to borrow money. This is why, aside from monthly income, banks look at your credit score before approving your loan or card application.

To spare you the heartache of dealing with another string of declined applications, here are five things you can do to improve your credit score:

Get a Credit Card Early and Use it Responsibly

Getting a credit card ASAP is one of the best ways to demonstrate to banks how financially responsible you are. Here’s an overview of Security Bank’s credit cards to help you decide which one to get. Make a good impression by using your credit card to make purchases that you can pay off on time. It’s also a good idea to have a buffer in your credit limit just in case you need to divert funds elsewhere.

Avoid late payments

Sounds easy enough, right? However, there will be times that you won’t be able to pay your monthly dues–may it be due to emergencies, financial incapacity, or even just forgetting to pay altogether. Make a habit of paying your bill early, or better yet, pay it twice a month.

But you can always pay the minimum, right? Not exactly. If you pay just the minimum amount, the remaining balance will be carried over to the next billing cycle, plus interest! Making sure that you spend within your capacity goes a long way in improving your credit score.

Having trouble with meeting payments? Read I Can’t Pay My Credit Card Bill Now What?

Pay off debts or keep them to a minimum

Obviously, paying off previous debts can help improve your credit score, but if settling all your balances in one go is impossible at the moment, then you should at least keep it to a minimum or manageable amount.

It’s not just about how much you owe, either; it’s about how much you owe compared to your credit limit. For instance, an P18,000 balance from a P25,000 credit limit gives you a total credit utilization of about 75%, which is still a big number.

There are also services that let you consolidate your credit card debts into one account so you can pay them off more easily. For example, the 0% Balance Transfer lets you transfer credit card balances with high interest into a credit card with a lower rate, which will help you save money and pay your debt faster. You can transfer balances from pretty much any credit card in the Philippines including your BDO credit card, BPI credit card, Citibank credit card, or Metrobank credit card.

Don’t exceed your credit limit on any of your existing cards

Carrying a balance that is higher than any of your existing credit limits is a red flag for most banks and can cause your credit score to dive. This balance typically includes interest payments so if you’re nearing your credit limit and can’t quite pay your required balance, consider converting big transactions to installments.

Request for a raise in your credit limit

If you really can’t pay off your total debt, then you can ask the bank to increase your credit limit. Since credit reports are based on percentages, a higher credit limit will typically result in lower credit utilization, assuming your expenses remain in the same range.

Going back to the previous example, an increase in credit limit to P50,000 from P25,000 will bring the same P18,000 balance you had down to just 30%. It’s a significant improvement and one that should improve your credit score. Just remember that banks won’t increase your limit if you’re already over credit limit or delinquent.