CIBIL Score

A CIBIL score is a 3-digit numerical score representing your creditworthiness. CIBIL score ranges from 300 – 900, where 900 is the highest. This score indicates how well you manage your credit. You can check your CIBIL score for free with no impact on the score. The score helps lenders determine whether you will be able to repay the loan in the given tenure or not. Higher the score, higher are your chances of loan or card approval.

Take a look at CIBIL score ranges:

Follow these steps to check your CIBIL score for free:

• Click on "Check Now"
  
• Enter a few personal details, such as your employment type, name, PAN, mobile number, date of birth and more
• Agree to the terms and conditions
• Click on 'PROCEED WITH OTP'
• Enter the OTP sent to your registered mobile number
• On verification of details, you will be able to view your CIBIL score. You will also receive a free credit report.

Here are a few factors that affect your CIBIL score:

• History of Loan Repayment

Timely loan repayment can boost your CIBIL score significantly. At the same time, if you default on your loan repayments, your score will fall.

• Age of Credit History

The age of your credit history is another crucial factor affecting your CIBIL score. If you have availed of credit cards or loans for a long time and have repaid them consistently, you will have a high score.

• Credit Utilisation Ratio

It is the percentage of the credit limit that you use every month. Ideally, you should not use more than 30% of your credit card's limit to maintain a healthy CIBIL score.

In addition, credit mix and hard enquiries can also impact the credit score.

The CIBIL score is a common eligibility parameter when you apply for loans. Having said that, when lenders run a credit check, they try to assess what kind of a borrower you are. In this regard, your credit history helps them know how well you have managed loans and credit cards in the past. 

Thus, irregular debt payments and maxed-out credit cards might pose you as a risky borrower, hampering your creditworthiness.

Maintaining a healthy CIBIL score is beneficial for borrowers due to the following reasons:

• One of the primary advantages of a good CIBIL score is that it increases your eligibility to get loans. Some financial institutions might even offer you pre-approved offers if you have a high credit score.

• With a high CIBIL score, lenders might offer you a loan with a lower interest rate. This is because you have already established that you are a responsible borrower.

• Apart from the lowered interest rate, you might ask your lender to increase the loan tenure

Your CIBIL score might be low due to various reasons, such as:

• Irregular credit card or loan repayment

• Missed EMI payments

• No credit history

• Too many unsecured loans

• Multiple hard inquiries

• The discrepancy in credit report

If you have a low CIBIL score, here are a few ways through which you can improve it:

• Pay your dues on time

• Avoid taking too many loans at the same time

• Maintain a good credit mix

• Review your credit report at regular intervals

• Don't utilise the full extent of your credit limit