As the income levels of individuals continue to rise in India, the adoption of credit cards has seen a significant surge. By May 2025, the country recorded an impressive 11.11 crore active credit cards, a notable increase from 10.33 crore in May 2024 and just 6.10 crore in january 2021. This rapid growth reflects a changing economic landscape, where more people are embracing credit as a financial tool. However, with this increase comes the responsibility of managing credit wisely.
A critical question many consumers grapple with is: how much of their credit limit should they actually spend? Surprisingly, studies suggest that nearly half of the public is unaware of the ideal percentage to utilize. Financial experts recommend keeping credit utilization below 30% of the total credit limit. This guideline is crucial because spending excessively can lead to high-interest debt, negatively impacting one’s credit score and overall financial health.
Moreover, the allure of credit can lead individuals to overspend, especially in a consumer-driven society. While credit cards offer convenience and rewards, they also come with the potential for financial pitfalls. Overspending can result in mounting debt, making it difficult to pay off the balance, particularly if one is only making minimum payments.
To maintain a healthy credit profile, consumers should regularly monitor their spending habits and strive to stay within the recommended limits. It's essential to treat credit cards as a tool for managing cash flow rather than as an extension of income. By understanding the importance of responsible credit usage, individuals can enjoy the benefits of credit cards while safeguarding their financial future. As the number of credit card users continues to grow, education on responsible spending becomes more crucial than ever.
Disclaimer: This content has been sourced and edited from Indiaherald. While we have made adjustments for clarity and presentation, the unique content material belongs to its respective authors and internet site. We do not claim possession of the content material.
.jpg)
click and follow Indiaherald WhatsApp channel