CIBIL Credit Report Checklis

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CIBIL Score Ranges: What is considered to be the Best CIBIL ...

CIBIL credit reports are important for many reasons. Follow the checklist given below is what you should keep in mind while checking your credit score

History of repayments – Your history of loan and credit card repayment is detailed in this section. It also includes information on the months that the repayments were paid and if they were completed before the due date. Additionally, it lists any missed or late payments. Banks and lenders use the details in this section to evaluate your credit repayment behaviour. You must thus carefully review and make sure that the repayment history is fully described and updated to reflect the most recent information in your credit report.
Credit Accounts – The part on credit accounts in a credit report covers all credit accounts, both open and cancelled recently. These details are carefully examined by banks and lenders when they assess your creditworthiness. Therefore, it’s crucial to check that the information on your loans and credit card accounts is accurate and up to date in your credit report. Any erroneous information or inaccuracy can seriously affect your credit score and your ability to qualify for a loan or credit card.
Credit utilization ratio (CUR) – This is one of the most crucial factors credit bureaus take into account when determining your credit score. The credit utilisation ratio shows how much of your available credit you have really used. Banks favour lending to borrowers with credit utilisation ratios under 30%. Those who frequently go above this limit might ask their credit card company to raise it, or they can apply for a new credit card. As long as you do not raise your credit card usage, this aids in lowering your credit utilisation ratio.
Personal details – Your name, PAN, mobile number, email address, and other personal data are covered in this section. Any inaccurate or missing information in your credit report compared to what is stated in your credit application can increase or hurt your chances of simply obtaining a loan or credit card, as lenders look at your credit report when analysing a loan or credit card application.
Credit report enquiries – Any credit report inquiries that a lender initiates are covered by this clause. Depending on the credit bureau, this section typically includes the lender’s name, the application date, the type of credit requested, and other information. Banks and lenders review your credit report, which is produced by the credit bureaus, each time you apply for a loan or credit card. These inquiries are known as “hard inquiries” since they are started by the lender and each one appears in your credit report. Your credit score may suffer as a result and drop a few points. Therefore, applying for many loans or credit cards within a short period of time with various lenders or credit card issuers might cause a big drop in your credit score.
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How is CIBIL Score Calculated?

A CIBIL Score is a numeric summary of credit history that is calculated based on the following factors:

Track Record of Past Payments	Record of all past repayments Consistently making payments on time leads to a higher score Delayed payments lead to a lower score Recent delayed payments make a more negative impact
Previous Settlements, Defaults, Write-offs	Recent write-offs impact more negatively than older ones Multiple write-offs lead to lower score Write offs documented by lenders on previous debts lower score Delays or defaults on secured loan repayments impact more negatively than unsecured loans
Loans as Proportion of Income	Low loan balance indicative of healthy credit usage and thus higher score High loan balance reduces score
Secured Loans vs. Unsecured Loans and credit cards	High credit card balances lower score Reliance on unsecured loans (credit cards) over secured loans viewed negatively Lesser number of such accounts coupled with frequent payment history pushes up score
Loan Equities	Many loan enquiries to avail loans indicative of “credit hungry” behaviour, negatively impacts score

Credit Bureaus in India

A credit bureau is a company that gathers and analyses information about a person’s or a company’s credit transactions. These include the borrowing of loans, the use of credit cards, the use of overdrafts, etc., and their repayments. Additionally, information on Income Taxes, timely utility bill payment, and other matters may be included in this analysis. Lending institutions, data collection companies, money collection agencies, and other organisations provide such information. The four credit bureaus in India are listed below:TransUnion Credit Information Bureau (India) Limited:

The most well-known credit agency in India is TransUnion Credit Information agency (India) Limited, also referred to as CIBIL.
It was founded in 2000 and currently manages the credit histories of over 600 million Indians and 32 million corporate entities.
The credit bureau offers comprehensive reports on the basis of credit statements from personal as well as commercial borrowers to its reputable partners.

Experian:

Experian, another credit bureau recognized by the Securities and Exchange Board of India (SEBI), was founded in 2006 and began operating in India in 2010.
Individuals can obtain credit information reports which outline their credit history.
Customer acquisition records, customer targeting and engagement reports, and other data can be accessed by companies and businesses.

CRIF High Mark:

CRIF High Mark is the only credit bureau authorized to conduct business in India by the Reserve Bank of India.
It was founded in 2007 and received its operating license in 2010.
It pertains to people, microfinance borrowers, medium and small enterprises (MSMEs), etc.
The range of scores provided by CRIF High Mark is 300 to 850, with a score of 720 or higher being the best and a score of 640 or less being subpar.

Equifax:

Equifax, which is one of the three biggest credit bureaus in the world, started out as a retail credit business in 1899.
It received its operating license in 2010 and provides credit scores, portfolio scores, risk scores, and others for people.
These scores range in value from 1 to 999, with 999 representing the highest score.

Why is Your Credit Score Low?

The primary reasons for a low credit score are listed below:

Many people are unaware that even one or two missed credit card payments can negatively impact your credit score. The more delayed payments you have, the more damage is done to your credit history and credit score.
In case you have not availed a loan, you may not have much of a credit history and this might result in a low credit score.
You might occasionally not be able to make your payments because of an unexpected emergency. Any missed payments will be noted on your credit history, which will lower your score.
Sometimes an administrative mistake can lead to inaccurate information being reported on your credit report. This might occasionally occur due to fraud. Such errors may result in a lower credit score without any of your fault, alerting potential lenders regarding your poor credit.

How to Get a CIBIL Credit Score and Report?

To obtain your credit score and credit report you will need to contact the credit rating agency in India, CIBIL. They will be charges involved to obtain a credit score and credit report. Any individual wanting this report will need to pay an amount of maximum Rs. 500 to obtain this report, the application process with a payment applies to both individuals and institutions. Let’s say a bank or financial institution needs your credit report with your score to check your loan eligibility, even if they will need to make a payment for that copy. There are a few websites that will promise to give you your credit report and score for free, but will ask you to sign up with them or become a member of their website etc.