CIBIL Score : Everything about CIBIL score & Credit score

CIBIL Score : Everything about CIBIL score & Credit score

Cost of living in India is not on par with the income levels of the common man so, is the raising need for loans to India. Many private and public sector banks are offering loans to the people with good repayment capacity. What is the criterion that banks look at to offer loan to address different needs? This is the question at which most of the loan seekers are stuck at. CIBIL score is an assurance to the bank about your responsibility of repaying the credit at the right time. Banks tend to look at both your repayment capacity and CIBIL score to approve any loan. The current article is to throw limelight on the importance of CIBIL score in the loan approval and ways to check it free online.

Let’s us start the article by understanding what CIBIL score is

CIBIL score is alternatively called as credit score given by credit agencies reporting your repayment history. This provides the lender with an idea about your promptness in repaying the credit. A good credit score will make it easy to get the loan and opposite happens in case of poor credit score.

How to establish a credit score?

Every loan sanction needs you to have a good credit score in addition to repayment capacity. How can you establish credit score when you are new loan seeker?  You can establish a good credit score by taking a credit card from the reputed bank. Your true repayment history will build a good credit score which serves as a positive feature for your loan approval process.

Benefits of CIBIL score

Apart from making the loan approvals faster, there are many benefits of having a good credit score.

Get accesses to best credit cards

Many people today are relying on the plastic money to conduct online transactions. Having a good credit score will give accesses to good credit cards with best offers. Platinum cards that are offered to the people with good credit score have a wide range of benefits while conducting offline and online transactions.

Increases eligibility for loan

Apart from making the loan approval faster, the good CIBIL score increases your eligibility for the loan.  The lender will be more keen in extending the credit to you.

Low-interest rate

This is one of the best benefits that anyone could ever get with the credit score. A person with the good credit score will get easy loan approval from different. This will help him stand in a position to negotiate the interest rates with different lenders while seeking credit thus increases the chances of getting the loan at the lower interest rate. 

Everything about CIBIL score

CIBIL score process

Knowing the process of CIBIL score generation is as important as establishing the credit score. This vital information will help you build your credit score to get better options in the future. Whether you are developing a credit score by taking credit or loan, the lender reports your monthly repayment history to the credit agencies. This credit agency maintains the records of the credit history of both entities and individuals to prepare the credit report. The credit report prepared by these agencies serves as a base for the lenders to extend credits for different purposes.

Calculation of CIBIL Score

Calculation of the credit score involves analysis of the data provided by the banks and financial institutions related to loans, credit card repayment history along with details of the skipped payments if any. The data also includes current loans that are open, their interest rates and the loans that have closed along with the current  credit card limit and the number of credit cards that are being used. Good credit score will make you stand eligible for quick loan approvals.

As it is said, credit score plays a vital role in the loan approval of the loans. It is essential to check the credit score even before you apply for the loan. Rejection of the loan due to low credit score will reduce it future making your future loan requests difficult. Many factors impact your credit score apart from the repayment history, it can be a number of loans taken, many credit cards being used and credit limit swiped every month so, it is essential to check your credit score often to make sure it is intact. There are many ways to check CIBIL score. Few websites allow you to check the credit score online for free.

How to check CIBIL score online?

Official website of credit agency

Checking the credit score by logging into official credit agency is one way where you need to furnish required documents.  You will receive the report through E-mail after verification of the documents, and it may take a day for you to receive the reports.

With PAN card

If you feel that the above-stated method is bit complex, a simple PAN card will get the job done for you. All you need to is submit the PAN card details through websites like Wishfin along with your basic KYC, and you will see the credit report is generated for you in a while.

What’s up

The new method that is emerged recently has made checking the credit score for free much more comfortable. You can see just What’s up the required details to the stated number of the website and you will receive the report in the chat message. Checking the credit score quite often will enable you to take necessary actions if there is a need to make corrections in the misrepresented information, or improve the credit score if needed.

How to improve credit score?

If you find that you have a poor credit score from the report generated, you can take necessary actions to improve the same. You should make to stand responsible for paying your EMIs on time. You should not take too many loans which hamper credit score. If you have not established any credit score till date, you can apply for the credit card and spend it in the limits of your repayment capacity to score well.

Leave a reply