Check Your CIBIL Score

A credit score is a three-digit metric that showcases your creditworthiness and allows financial institutions to assess your risk profile. Credit bureaus like TransUnion CIBIL, Equifax, Experian, and CRIF High Mark issue this score using different scoring models and algorithms.

 

Your CIBIL score is the credit score that TransUnion CIBIL issues, which is one of India’s oldest credit information companies. It supports financial companies in making informed decisions about loan or credit card applications.

 

Although CIBIL score and credit score are often used interchangeably, CIBIL score is the credit score specifically assigned by TransUnion CIBIL. To check your score assigned by this credit bureau, you will need to provide basic personal information, which includes your name, PAN, and date of birth.

To compute your credit score, TransUnion CIBIL assesses your credit history to analyse your behaviour with loans and credit cards in the past. Here is why a good credit score is crucial in your financial journey:

• A high credit score indicates responsible credit usage

• It helps you get loans easily and at attractive interest rates

• A good score may lead to faster approval of loan and credit card applications

• With a good score, you can get higher credit limits on your credit cards, overdraft accounts, and other lines of credit as well as your desired loan amount

• A higher score gives you more power to negotiate for better terms of credit from lenders

 

While the CIBIL score is not the only aspect that affects your eligibility for credit, it is a major factor influencing approval. Here is the CIBIL score range and the chances of approval you are likely to enjoy:

Disclaimer: These probabilities are approximate, and actual approval depends on various other factors like income, existing debt obligations, employment stability, and lender-specific criteria.

You can check your CIBIL score for free through a quick process on Bajaj Markets. Here are the simple steps to follow:

1. Click on ‘CHECK YOUR SCORE’ on this page

2. Enter the required details, including:

   • Your name

   • PAN details

   • Date of birth

   • Email ID

   • Mobile number

   • Residential pincode

3. Choose your employment type from the two options provided, Salaried or Self Employed/Business Owner

4. Agree to the terms and conditions by checking the box

5. Click on ‘GET REPORT’ button

6. Enter the OTP to receive on your registered mobile number to access your credit score

You can even check your score from the TransUnion CIBIL website (www.cibil.com/freecibilscore) for free once a year.

By knowing how TransUnion CIBIL assigns you the score, you can improve your credit-related habits. Financial companies report all credit activities to the bureau, using which it creates your credit report.

 

You are assigned a score based on this report and patterns in your behaviour with credit. Here are some of the major factors that affect your CIBIL score:

Repayment Trends

The more regular you are with repayments (be it loan EMIs or credit card bills), the higher your score will be.

Credit Card Utilisation Ratio and Transactions

Utilisation ratio refers to the percentage of credit you have used from your card’s total credit limit. Maintaining it below 30% can help you boost your score. Similarly, TransUnion CIBIL studies your credit card transaction history to check how responsibly you use your credit card.

Credit Mix

Having too much unsecured credit against your name may drag your score down as it means you only have experience with collateral-free loans. By taking and repaying a mix of secured and unsecured loans, you can showcase a history with different types of credit and boost your score.

Length of Credit Experience

The bureau considers the last 36 months for calculating credit scores for a widespread analysis. It also assigns you a score based on the oldest credit account you have, so having a longer history with credit can influence your score positively.

Bill Payments Trends

If you have a history of paying only the minimum amount due on your credit card bill, your score may be lower. These trends are analysed by TransUnion CIBIL to calculate your score.

Number of Hard Enquiries

When you apply for a credit product, the lender checks your score, which is referred to as ‘hard pull.’ When you apply for multiple loans or credit cards within a short period, it signals financial distress.

 

Multiple credit enquiries can lower your score as it can make you seem hungry for credit.

Debt-to-income Ratio

The existing obligations you have are also considered against your income and earnings. A higher ratio can lead to a lower score as it means most of your income is already being used in repaying current debts.

Repayments vs Dues

Similarly, how much you have repaid from the total dues you currently owe also affects your score. For instance, if you have repaid 70% of your total obligations, your score is better than if you have repaid only 30%

Number of New and Closed Credit Accounts

TransUnion CIBIL also takes into consideration the number of recent and past loans and credit cards you have to analyse your risk of default. Having too many loans or cards against your name may lower your score.

You can steer your journey with credit, keeping the above aspects in mind. By using credit responsibly, you can enhance your score. Let us understand with an example of how Sumati and Sushant behave with credit and the impact of their actions on their creditworthiness:

Disclaimer: The examples in this table are for illustrative purposes only. The exact impact of credit habits and their effect on credit scores is proprietary to TransUnion CIBIL.

While it takes time for your credit score to improve, a sudden fall in the score is also possible. When this happens, check your credit report to see the cause. Here are some reasons why your score could dip all of a sudden:

• You Have Applied for Multiple Loans or Credit Cards Simultaneously: This results in multiple hard inquiries of your credit score at the same time and decreases your score

• You Have Just Made a Big-Ticket Purchase With Your Credit Card: This increases your credit utilisation ratio and reduces your score

• You Have Closed an Old Credit Card: This reduces the length of your credit history and affects your score negatively

• You Have Just Settled a Loan: Settlement showcases an inability to pay off debt responsibly and causes your score to drop

• You Have Paid Off a Long-Term Loan: An older loan that you were repaying with timely EMIs being suddenly closed can also reduce your score

• Your Credit Limit on a Credit Card Has Decreased: This may increase your credit utilisation ratio and impact your score adversely

• There is a Fake Loan in Your Name: Unpaid EMIs towards a loan against your name that you are unaware of can also bring down your credit score

A low CIBIL score isn't permanent. With consistent financial discipline and responsible credit habits, you can rebuild it and secure loans at favourable terms. These guidelines can help: 

• Pay all your dues and EMIs on or before the due date to see a positive impact on your score 

• Ensure that you are using less than 30% of your credit card’s credit limit to showcase responsible usage

• Track your credit report for any errors or fake loan accounts in your name that may pull your score down

• Refrain from applying for multiple credit facilities within a short span of time

• Ensure you pay your credit card bills in full and use the card responsibly 

• Check repayments of credit where you are the co-signor or guarantor and ensure there are no missing payments 

• Try to apply for different types of credit products and not just unsecured loans

If you are just entering the workforce or have no experience with credit, your CIBIL score is likely to be below 300 or have the ‘No History’ (NH) tag. In this case, building a positive credit history is the only way to increase your creditworthiness.

 

However, it may seem like you cannot get credit without having a good credit score, and to have a good score, you need to have experience with credit. You can break out of this cycle by taking a slow and steady approach to building your credit profile.

 

Consider the following:

Apply for an FD-backed Credit Card

The approval for this card is based on a fixed deposit you book as collateral. Even if you are new to credit, you can qualify for this secured credit card with ease. The credit limit is 70% to 100% of the FD amount, and you can use the card just like a regular credit card.

 

By making timely bill payments and ensuring your credit utilisation ratio is below 35%, you can build your credit score over time.

Sign up for a Buy Now Pay Later (BNPL) Option

Most e-commerce platforms offer the BNPL option where you can pay for your purchase in installments. This is a type of credit facility and is reported by the financial institution to credit bureaus.

 

Ensure you do not miss your payment deadlines to create a positive credit history.

Take a Credit-builder Loan

Certain financial companies offer loans specifically for new-to-credit customers. They start a savings account or certificate of deposit in your name, which earns a certain interest. You are required to pay EMIs for a specific loan amount (based on the principal and interest rate) for a chosen duration without actually receiving the loan amount.

 

Once you have successfully paid all EMIs, the financial company disburses the funds. This way, the lender covers its risk while allowing you to build a positive credit history.

Get a Consumer Durable Loan

Both online and offline retailers offer these loans for electronics, furniture, and more. You can shop for a laptop and pay in EMIs as per due dates. This is recorded in your credit report and contributes to increasing your score.

 

While on the journey to building your credit score, do not make the following mistakes:

• Miss your EMIs or credit card bill payments

• Max out your credit card

• Apply for multiple loans and credit cards at the same time to try your luck

• Apply for credit without checking your eligibility

TransUnion CIBIL is not the only credit bureau in India. CRIF High Mark, Experian, and Equifax are also registered with the RBI. Each of these bureaus uses proprietary models to assess the creditworthiness of potential applicants.

 

As such, the score you are assigned by one bureau may be different when compared to the other. Even the score ranges have slightly different meanings. Check them out below:

 

TransUnion CIBIL

 

CRIF High Mark

 

Experian

 

Equifax

Disclaimer: The policies of credit information companies may be updated from time to time. Check the latest information on the official websites.

While your score is a summary of your credit behaviour and history, it is based on the information contained in your CIBIL report. Also called a Credit Information Report (CIR), this document provides detailed information about your old and new loans, credit cards, and more.

 

Reading your report helps you see all the loans or credit cards against your name. This makes it easy for you to spot any unauthorised loans or credit cards that may have been taken in your name or any outdated information that may affect your score.

 

This may be a loan you have recently repaid in full, which is still showing as unpaid. Getting these issues corrected by raising a dispute can help you increase your score.

While it may seem like a complex document, reading your CIBIL report is easy when you know what each section is about. Take a look at them below:

CIBIL Score

This section displays your credit score, which is based on the data captured in the ‘Accounts’ and ‘Enquiry’ sections mentioned further down in the report.

 

Account Information

This section shows all your loans and credit cards. It captures all the related information reported by financial companies, including:

• Type of credit product (car loan, credit card, personal loan, etc.)

• Account number

• Date and amount of last payment

• Current balance

• Overdue amount, if any

 

Profile Information

This section lists data such as your name, gender, and date of birth. It also contains your various identification numbers, such as your Passport Number, PAN, Voter ID information, and more.

 

Contact Details

This section shows up to 4 of your residential, temporary, and/or permanent addresses as per the information received from financial institutions. Your landline and mobile numbers, as well as email addresses are mentioned here.

 

Employment Details

This section displays your income and job/occupation based on the information given by lenders to TransUnion CIBIL.

 

Enquiry Information

This section shows the hard enquiries by financial companies for your credit information, along with details of the product you applied for. These include:

• Application date

• Type of credit product

• Loan amount

Image Source: www.cibil.com

 

Some key terms to understand in this report are:

• Account Type: Shows the details of the credit product, such as a loan, credit card, or more

• Days Past Due (DPD): Shows the number of days that your payment is past due on a loan or credit card

• Loan Settlement Status: Displays if you have any outstanding balance left or if the loan has been settled fully

• Standard Accounts: Credit accounts that are in good standing, meaning that you are repaying them responsibly and on time

A credit score is a three-digit number that summarises your credit history. For instance, say your credit score is 750. This number indicates that you have experience with credit and have been a responsible user. TransUnion CIBIL derives your credit score based on the ‘Accounts’ and ‘Enquiries’ sections of your CIR.

 

On the other hand, a credit report provides detailed information about your loans and credit cards over a period of time, including your repayment activity, loan details, etc. It is the basis on which your score is assigned. A CIR is a multiple-page report that has various sections, such as Account Information, Profile Information, and Contact Details.

A credit score isn’t just about securing loans at favourable terms. It impacts your life and goals at different stages by simplifying access to funds when needed most. Here are some instances where a good score comes in handy:

Early 20s - Getting a Credit Card or a Bike

When you are entering the workforce, you may be looking for a credit card or a two-wheeler loan. The right credit card can reduce the strain on your expenses and competitive bike loan interest rates can make your loan EMIs more manageable. A good credit score will impact your eligibility for both of these credit products.

Late 20s - Buying a Car

At this stage, you may consider buying your first car. For this, auto loans at competitive rates can be the best way to secure funds. However, a poor credit score will impact your ability to get a car loan at favourable terms.

30s -

• Purchasing Your Own Home

Purchasing real estate can feel heavy on your pocket, especially if you have just started working. A good score can ensure that you get a home loan at attractive interest rates and eases the repayment journey. Besides, home loan repayment runs longer and if managed well, helps build a good repayment history.

• Parenthood

Becoming a parent is a life-changing experience, and along with the joy and responsibilities, it can also have financial implications. You may need funds for medical needs, education, setting up a nursery, and more. In times of need, having a good score can help you secure a loan faster.

Upon Retirement

Once you retire, your regular salary stops, and you may rely on pensions, savings, or investments. You may need a loan at favourable rates for specific needs, such as travel, medical treatment, and more. Addressing all these needs is easier to get if you have a high credit score.

Keeping track of your CIBIL score is essential for maintaining good financial health. Here’s why you should check it on Bajaj Markets:

• With a simple and user-friendly interface, you can access your credit score in just a few clicks

• Strict data privacy protocols ensure that your personal and credit details are safe from unauthorised access

• Being an authorised partner of TransUnion CIBIL, Bajaj Markets ensures you receive accurate and reliable credit scores

• Using the Bajaj Markets App, you can monitor your credit health anytime and anywhere, right from your smartphone

• Using this financial metric and the report that comes along with it, you can detect and report fraudulent credit activities

Check out some of the common myths about CIBIL scores that need to be busted:

• Your Credit Score Drops When You Check It

Your credit score is impacted only when lenders conduct a hard enquiry. When you check your credit score, it is termed a soft enquiry, which doesn’t impact your score.

• You Cannot Improve a Low CIBIL Score

By employing certain strategies like timely repayments and maintaining a low credit utilisation ratio, you can improve your credit score gradually.

• You Cannot Get a Loan with a Low Score

Some lenders may provide you with a loan if you have a low CIBIL score or offer funds against collateral. However, they may charge you higher interest rates than customers with higher scores.