A credit score of 657 sits in the moderate-risk category. It is neither poor nor strong enough to unlock the best loan and credit card terms. However, with focused financial discipline, borrowers can steadily elevate their score into the ‘good’ range of 700 and above.
Rishabh Goel, Founder and CEO, Credgenics, explains the situation: “A credit score of 657 indicates moderate risk but warrants disciplined corrective action to improve. Prioritising on-time repayments, keeping the utilisation ratio below 30%, rectifying discrepancies, and limiting new credit applications are key. By maintaining financial discipline, you can accelerate score progress and build long-term creditworthiness.”
What is the impact of a credit score of 657?
A score in this band often results in:
- Higher interest rates for personal, consumer and auto loans.
- Lower approval chances for lucrative personal loans and premium credit cards.
- Stricter scrutiny by lenders during underwriting and loan disbursals.
Yet, the credit score of 657 is highly recoverable with consistent and structured financial behaviour.
Practical steps to improve your 657 score
1. Prioritise timely repayments
If you have started using a credit card, always keep in mind, never miss any due dates or pending bill payments. A delay of even 30 days can significantly lower your credit score. If possible, automate your personal loan EMIs, credit card bills and other payments to avoid any slip-ups.
2. Reduce credit utilisation to below 30%
- Focus on keeping monthly credit card spending under control.
- In case your monthly income has increased, request a credit limit increase.
- Never make purchases based on emotions, understand debt and borrow responsibly.
- If you have several credit cards, split expenses across them to keep credit utilisation in check.
- If you are in doubt, consult a certified financial advisor and opt for essential products only through a credit card. Never use credit cards for lavish expenses.
3. Review your credit report every quarter
Mistakes such as incorrect personal loans, outdated closures, or mismatches in identity details can lower your credit score. In all such cases, you should promptly write to your respective credit bureau and discuss with them so that any errors, mistakes or misunderstandings can be resolved.
4. Avoid multiple loan or card applications at once
When you apply for a personal loan, home loan and credit cards all within a short span of time, this can indicate credit hunger and can result in several ‘hard inquiries’ on your credit profile. Such a practice can temporarily lower your credit score and is generally advised against by professionals.
5. Build a longer and healthier credit history
Focus on maintaining existing credit accounts, such as credit cards and loans. Go for a low-ticket, secured and easy-to-repay loan if you aspire to rebuild your credit score. Target repayment consistency.
In conclusion, a credit score of 657 is not a dead end. With structured effort and disciplined financial habits, borrowers can move into a stronger credit bracket within months, unlocking better loan terms, improved financial stability and long-term creditworthiness.
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