695 CIBIL Score: Is it Good or Bad

A 695 CIBIL score is considered fair, sitting comfortably within the middle range of the CIBIL score spectrum. While it is not excellent, it is also not poor. With this score, you may face slightly higher interest rates compared to borrowers with higher scores (such as 750 or above). 

 

However, you still have the ability to secure loans and credit cards, although the terms may not be as favourable as for those with a higher score. If you focus on improving your credit habits, this score can rise into the "good" range in a relatively short time.

A CIBIL score of 695 is considered fair but could benefit from improvement. While not considered a "bad" score, it reflects a credit profile that may have some issues, such as occasional missed payments or high credit utilisation. 

 

Lenders may approve loans and credit card applications, but the interest rates and terms might be less favourable than what would be offered to individuals with a higher score. In India, this score is often classified as a moderate-risk borrower, meaning you may be offered loans but at slightly higher rates.

Here’s how a 695 credit score is categorised across India’s credit bureaus:

Yes, it is possible to secure a personal loan with a 695 CIBIL score, but it might come with higher interest rates than if your score were above 700. Lenders may still approve the loan, but the terms, such as the interest rate and loan amount, may not be as attractive compared to a higher credit score. However, it is still a positive sign that you’ve managed your credit well enough to be approved for a personal loan.

• Interest Rates: Higher than prime customers
  

• Loan Approval: Likely, but with higher scrutiny
  

• Loan Amount: Limited depending on other factors like income
  

• EMI: Higher EMI due to increased interest

• Consider a Co-applicant

Adding a co-applicant with a higher score can strengthen your application.

• Offer Collateral

Securing the loan with an asset (e.g., property or vehicle) can improve your approval chances.

• Demonstrate Stable Income

Lenders will look at your income and employment history. Provide clear evidence of stability.

• Maintain Low Credit Utilisation

Keep your credit card balances low to show responsible credit usage.

• Reduce Existing Debt

Lowering your existing debt obligations can make you appear less risky to lenders.

With a CIBIL score of 695, you may qualify for a credit card, but the terms will likely not be as favourable as those offered to individuals with higher credit scores. You may be approved for cards with lower credit limits, higher interest rates, and limited rewards. It’s advisable to apply for credit cards that are specifically designed for fair credit scores, or start with a secured card to rebuild your credit profile.

Credit Card Types for Fair Scores

For a 695 credit score, you may be eligible for the following types of credit cards:

• Secured Credit Cards

These require a fixed deposit as collateral and are ideal for individuals looking to rebuild or maintain their credit score.

• Retailer-Specific Cards

Some retailers offer low-limit cards for customers with fair credit. These cards can help you manage credit responsibly while shopping at specific stores.

• Credit Builder Cards

These are designed for those with fair credit scores, offering basic features to help improve your score over time.

What to Expect: Limits, Charges and Conditions

Here’s what you can generally expect when applying for a credit card with a credit score of 695:

• Credit Limits

Expect lower credit limits, typically ranging from ₹10,000 to ₹50,000, depending on the issuer.

• Annual Fees

There might be an annual fee, which could be higher than for cards offered to those with higher scores.

• Interest Rates

The interest rates may be higher, as lenders may consider you a 

• Rewards

Credit cards offered at this score range typically come with limited or no rewards. You may not have access to premium perks like cashback or travel rewards.

If you want to increase your chances of getting a credit card with a 695 CIBIL score, consider these strategies:

• Improve Your CIBIL Score

The higher your score, the better your chances of approval for a credit card with more favourable terms.

• Apply with a Bank You Have a History With

If you have a long-standing relationship with a bank, they may be more likely to approve your application.

• Start with a Low-Limit Card

Applying for a low-limit card could improve your approval chances, and you can increase the limit over time by maintaining a good payment history.

• Maintain Low Credit Utilisation

Keep your credit card usage below 30% of your available limit to show you’re using credit responsibly.

Your CIBIL credit report contains several important components that impact your score:

• Accounts

This section includes your open and closed credit accounts, showing how long they’ve been active and how they’ve been managed.

• Repayment History

This is a record of your payment behaviour, whether you’ve made payments on time, or missed or delayed payments.

• Credit Inquiries

Every time a lender checks your credit report, it is logged in this section. Multiple inquiries in a short period can lower your score.

• Credit Utilisation

This shows how much of your available credit you’re using. A high credit utilisation ratio can lower your score.

• Personal Information

Your name, address, and other identifying details are recorded here.

Although a 695 CIBIL score is not considered low, if you're below this threshold, it’s important to follow certain steps to repair and improve your credit health. By focusing on responsible credit management, you can gradually increase your score over time.

 

Here are some things you can do:

Timely Payments

Ensure you make all payments on time, including credit card bills, loans, and utility bills. Timely payments are essential to improving and maintaining your credit score. Even a single missed payment can have a negative impact.

Reduce Credit Utilisation Ratio

To improve your 695 CIBIL score, keep your credit utilisation ratio below 30%. This shows lenders that you're using credit responsibly and helps maintain a positive credit score. A high ratio can suggest financial strain and lead to a lower score.

Build Credit Using Secured Products

Consider using secured credit cards or secured loans to help improve your credit profile. These products require collateral but are easier to obtain and can demonstrate responsible credit management, leading to a better score over time.

Avoid Score-damaging Mistakes

Avoid mistakes like missing payments, maxing out credit cards, or frequently applying for new credit. These behaviours can damage your score. It’s crucial to stay on top of your finances and avoid any practices that might hurt your creditworthiness.

Avoid Applying for Multiple Loans or Credit Cards

Applying for too many loans or credit cards in a short period results in hard inquiries on your credit report. Multiple inquiries can lower your score and make you appear riskier to lenders. Apply for credit only when absolutely necessary.

To improve your 695 CIBIL score to 750+, you need to focus on the key factors that impact your credit score. With discipline and consistent financial habits, achieving a higher score is absolutely possible.

Consistent Payment Practices

Paying all your bills and debts on time is the most effective way to improve your credit score. Set up reminders or use automatic payments to ensure that you never miss a payment. This is the first step towards boosting your score.

Keeping Credit Utilisation in Check

Reducing your credit utilisation ratio to below 30% and maintaining a mix of secured and unsecured credit types (e.g., loans, credit cards) will contribute to an improved credit score. A diverse credit profile demonstrates your ability to handle different types of credit.

How to Improve Your Score in the Coming Months

Improving your score from 695 to 750+ generally takes 6 to 12 months, depending on your financial habits. By consistently paying bills on time, reducing debt, and avoiding new credit applications, you can expect steady progress.