How to Increase Your Credit Limit

A higher credit limit can be beneficial in many ways. It allows you to borrow a larger amount each month and, more importantly, helps improve your credit score by lowering your credit utilization ratio. If you’re a credit cardholder in the Philippines looking to increase your credit limit, this guide will walk you through the benefits, requirements, and steps to help you achieve a higher limit.

Why You Should Increase Your Credit Limit

1. More Spending Power

With a higher credit limit, you can make larger purchases without immediately maxing out your card. This is useful for emergencies, planned expenses, or major purchases like home appliances or travel bookings.

2. Better Credit Utilization Ratio

Credit utilization refers to how much of your available credit you are using. Banks and financial institutions consider a low credit utilization ratio (below 30%) as a positive factor for your credit score.

For example:

• If your credit limit is PHP 15,000 and you spend PHP 15,000, your utilization ratio is 100%.
• If your credit limit is PHP 60,000 and you spend the same PHP 15,000, your utilization ratio drops to 25%, which looks better to banks.

3. Improved Credit Score

Having a higher credit limit and a low utilization ratio improves your credit score over time. A better credit score increases your chances of getting approved for loans, mortgages, and other financial products in the future.

How to Qualify for a Credit Limit Increase

Most banks automatically review and increase credit limits for responsible cardholders. However, you can also request an increase. Here are the factors that banks consider:

1. Consistent, On-Time Payments

Paying your credit card bill in full and on time shows financial responsibility. Late or missed payments can lower your chances of approval.

2. Low Credit Utilization

If you frequently max out your credit limit, banks may see you as a high-risk borrower. Try to keep your spending within 30% of your credit limit.

3. Stable Income

Banks assess your income before approving a credit limit increase. If you’ve received a salary raise or changed to a higher-paying job, this can work in your favor.

4. Length of Credit History

The longer you’ve had your credit card, the better your chances of getting an increase. Banks prefer cardholders who have at least six months to a year of consistent usage.

Steps to Request a Credit Limit Increase

If your bank has not automatically increased your limit, you can submit a request. Here’s how:

1. Check Your Bank’s Requirements

Each bank has different requirements for credit limit increases. Visit your bank’s website or call their customer service to check eligibility criteria.

2. Gather Necessary Documents

Most banks require proof of income to justify an increase. Prepare the following:

• Latest pay slip
• Income Tax Return (ITR)
• Certificate of Employment
• Bank statements (for self-employed individuals)

3. Contact Your Bank

You can request a credit limit increase through various channels:

• Phone call – Call your bank’s customer service hotline.
• Email – Some banks allow you to send requests via email with attached documents.
• Online banking/app – Many banks offer an option to request an increase through their mobile banking apps.
• Branch visit – You can also visit a branch and talk to a bank representative.

4. Submit Your Request and Wait for Approval

Once you submit your request, the bank will review your financial history, income, and spending behavior. The approval process can take anywhere from a few days to a few weeks.

Tips to Improve Your Chances of Approval

• Use Your Credit Card Regularly – Show that you are an active and responsible cardholder by using your card for everyday expenses.
• Avoid Carrying a High Balance – Paying off your balance in full each month proves you can manage a higher credit limit.
• Keep a Good Relationship with Your Bank – Having other financial products with the same bank (like a savings account or loan) may increase your chances.
• Wait Before Reapplying – If your request is denied, wait at least 3 to 6 months before applying again to show improved financial standing.

What to Do If Your Request Is Denied

If your bank denies your request, don’t worry. Here’s what you can do:

• Ask for the reason – Contact your bank to understand why your request was denied.
• Improve your financial profile – Increase your income, lower your debt, and maintain timely payments.
• Try again after a few months – Most banks allow reapplication after a certain period.
• Consider another credit card – If you need more credit, applying for a second card with another bank could be an option.

Final Thoughts

Increasing your credit limit in the Philippines is achievable with responsible financial habits. By maintaining a good credit score, making timely payments, and keeping a low credit utilization ratio, you can qualify for a higher limit and enjoy more financial flexibility.

If you’re looking to apply for a credit card or request a credit limit increase, check out our website to find the best options available!