Credit cards come with a predefined credit limit and it is the maximum amount that you can spend on your card. In order to maintain a lower credit utilization ratio, you should keep your credit card balances well below this limit. However, when you use up the entire limit available to you or are very close to exhausting the limit, your card is said to be maxed-out.
For example, if your total credit card limit is Rs.1 lakh and the overall balance due is Rs.1 lakh, this means you have maxed out your credit card. Also keeping a low credit balance will not only improve your credit score but also reduce the risk for lenders to sanction your loans.