When you apply for a credit card, the bank checks your credit report to evaluate your repayment behaviour. This process is called a hard enquiry, and it has a direct impact on your credit score. Many people do not realise that multiple card or loan applications in a short time can lower their credit score and reduce approval chances.
This guide explains what hard enquiries are, why they affect your credit score, and how you can manage them smartly.
What Is a Hard Enquiry
A hard enquiry happens when a lender checks your credit report as part of approving a credit card, loan, or EMI offer. It shows that you are seeking new credit. Each hard enquiry slightly reduces your credit score.
Hard enquiries remain on your report for up to 24 months.
Hard Enquiry vs Soft Enquiry
Soft Enquiry
- Does not affect your credit score
- Happens during checking your own credit score, pre-approved offers, or background checks
Hard Enquiry
- Impacts your credit score
- Happens when you apply for a new credit card, personal loan, or line of credit
How Hard Enquiries Affect Your Credit Score
Score Drop
Each hard enquiry can reduce your credit score by a small margin. If you apply for multiple cards within a short time, the score drop becomes higher.
Higher Risk for Lenders
Multiple enquiries signal that you may be credit-hungry. Lenders may reject your applications or offer less favourable terms.
Lower Approval Chances
Too many hard enquiries reduce your credibility, affecting your eligibility for premium credit cards and loans.
How Many Hard Enquiries Are Safe
Ideally, you should limit yourself to one or two credit applications every six months.
Too many applications show instability in your credit behaviour.
Smart Ways to Avoid Credit Score Impact
Apply Only When Needed
Avoid randomly applying for multiple cards. Choose only a card that fits your needs such as fuel credit cards, shopping credit cards, or travel credit cards.
Check Eligibility Before Applying
Use pre-eligibility tools to know if you qualify for the card.
Maintain Good Credit Behaviour
Pay your credit card bill on time, maintain low utilisation and keep old accounts active. This helps offset minor score drops from enquiries.
Avoid Multiple Applications in Short Time
Space out your card and loan applications. This keeps enquiries minimal.
Choose a Card That Matches Your Income and Profile
This reduces chances of rejection and prevents repeated applications.
Should You Worry About Hard Enquiries
Hard enquiries are normal. They only become harmful when:
- You apply for too many cards
- You apply for cards without checking eligibility
- You apply with low income or poor credit profile
With careful planning, you can minimise the impact.
Final Tips to Keep Your Score Safe
- Monitor your credit report regularly
- Avoid unnecessary card applications
- Build a long-term healthy credit profile
- Use credit card rewards, bill payment features, and EMI options wisely