Balance Transfer Hits Credit Score Before It Helps, Experts Say

Lenders watch repeated transfers closely. Rohit Mahajan, Founder & CEO of plutos ONE, said India has more than 12 crore credit cards in circulation and monthly card spending exceeds ₹2 lakh crore. "Credit card balance transfers should NOT be considered as a financial planning tool," Mahajan said. "It can, for a time, lower the interest load, but it can also be a warning to a creditor that a borrower is having difficulty with their other debts."

Repetitive balance transfers flag a potential borrower to lenders, Mahajan said. They may suggest the applicant is in financial trouble or lacks discipline. He stressed that a transfer only helps if the borrower has a repayment plan. "Just paying one debt with another is not a viable solution if the debtor will not stop spending the money," he said.

A transfer used strategically, with disciplined spending and timely repayments, can support credit health over time. Relying on repeated transfers without addressing the root cause of debt weakens the credit profile, the experts said.

"With a balance transfer, it isn't supposed to be done to postpone the question; it is supposed to assist you in permanently getting rid of your debt," Mahajan said.