New Delhi, March 12 -- In India, the know-how of your credit card limit is critical for maintaining a healthy credit score. Although individuals pay attention to the date of payments and outstanding debt, the credit limit takes centre stage when it comes to determining your financial wellbeing. This write-up is dedicated to how your credit card limit matters and why it determines your credit score and your overall credit profile.

Your credit limit is simply the most amount you could borrow from your respective card company. It is set based on various factors, including your income, credit history, and loan repayment habits.

A high credit limit can benefit your credit report by keeping your credit utilisation ratio low i.e., the ratio of...