Cibil score is a company which maintains a record of every loan, i.e. it keeps a complete account. This report contains the complete information about the loans and credit cards taken by you till date.
According to Kalapaisa, your credit score is generated on the basis of your Cibil loan EMI, credit card usage and the way you pay the bills.
Those who have never taken any loan and neither do they use a credit card. Such people do not have a credit score (Cibil Score) because they do not have any credit history. This is also not considered right because credit information companies cannot know whether you should be put in the risk category in terms of loan or not.
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| Cibil score |
Credit score depends on many factors. 30% of CIBIL score depends on whether you are repaying your loan on time or not, 25% on secured or unsecured loan, 25% on credit exposure and 20% on loan utilization.
If you want to take a loan, then credit score plays a very important role in it because on the basis of credit score (Cibil score) it is decided whether you should be given a loan or not.
And how much can be given? If your score is good then you get loan easily and the interest rate also seems to be quite reasonable. But if your credit score is low then it becomes difficult to get a loan.
What is Cibil score
CIBIL score is a three digit number. It ranges from 300 to 900. It indicates a person's loan eligibility. The closer your credit score is to 900, the better your credit profile and a high CIBIL score indicates a person's good credit history and responsible repayment behavior.
You will not get loan on bad CIBIL
If your CIBIL score is bad, then you do not get a loan. Otherwise, you will have to face a lot of difficulties to get a loan. If you get it, then you will have to pay expensive interest to the bank for it. We are going to give you some information in this news, with the help of which you can improve your CIBIL score.
Do not take too many loans at once
Taking multiple loans at the same time is very bad for your credit rating. You should take as much loan as you can easily repay. If you take too many loans, it will be difficult to pay their installments on time. This will have a very bad effect on your CIBIL score.
Keeping a good Cibil Score gives you this benefit
Whenever you go to the bank to take any kind of loan, the bank first checks your CIBIL score. Only after this the bank approves its loan. Along with this, having a good CIBIL score also gives you the benefit of a loan at a lower interest rate.
Along with this, you also avoid unnecessary bank documentation. In such a situation, to keep your CIBIL score right, pay all your EMIs on time. Along with this, pay the credit card bill on time. If you do not do this, your CIBIL score can be affected.
What is good and bad CIBIL score?
As we have already mentioned, a CIBIL score ranges between 300-900. Generally, a CIBIL score of 750 is considered good, and individuals are viewed as responsible borrowers by lenders. Here are the different categories of CIBIL scores
NA/NH
If you don’t use a credit card, or have never taken out a loan, you won’t have a credit history.
300-549
You have shown irregular repayments or defaults on credit card bills or EMIs, High credit risk, you will be considered at a high risk of defaulting, and will find it difficult to get a loan or a credit card
550-649
Some irregularities in your earlier payments, like late payment of credit card bills/EMIs or multiple credit inquiries, some lenders will consider giving you credit, but your interest rates may be higher
650-749
You have demonstrated responsible repayment behaviour and have a long credit history, while most lenders will consider your credit and loan applications, you may not get a better deal on interest rates
750-900
If you are paying your bills regularly and have an ideal credit history, banks and lending institutions will consider you a low risk of default and offer you better deals on loans and credit cards
Take as much loan as you can easily repay
Another thing to keep in mind is that to improve your credit rating, take only as much loan from a bank or financial institution as you can easily repay. Because if you take more loan, the EMI will be higher.
And if you show any negligence in paying it, then it will have a direct impact on your CIBIL score. If the CIBIL score is bad, then you will face problems in getting a new loan
Cibil Score Check: Check your CIBIL score for free.
If you use Google Payments then you will find an option called Check your cibil score for free at the bottom of the Google Payments dashboard. You can check it by clicking on it.
Or you can also check the cibil score by visiting its official website, there you have to give whatever details it asks for. There you can check the cibil score for free.
Cibil score How to improve CIBIL score.
One of the best ways to improve CIBIL score is that the customer should pay all his dues on time. If the loan is running
So the loan should be repaid on the due date and the credit card dues should also be paid on or before the due date. Doing so improves the CIBIL score.