718 Credit Score: Is It Good or Bad?

A credit score reflects your creditworthiness and financial behaviour. It is a critical factor that lenders evaluate when considering loan approvals and interest rates. A score of 718 is considered good in India. It signifies that you have demonstrated responsible credit behaviour, such as timely repayments and maintaining a low credit utilisation ratio. While a score of 718 is considered to be good, there is a scope for improvement to get better credit terms and offers.

Credit bureaus use unique scoring models, and a 718 credit score might fall into slightly different categories depending on the bureau. Here’s how it is interpreted:

Here are the financial benefits you can enjoy with a credit score of 718:

Favourable Interest Rates

Lenders often offer competitive interest rates to borrowers with a 718 CIBIL score, which reduces your overall borrowing cost.

Increased Loan Approval Chances

A good credit score increases your credibility with lenders, improving your chances of securing loans for personal, home, or vehicle financing.

Eligibility for a Range of Credit Cards

With a CIBIL score of 718, you qualify for a variety of credit cards, including those offering cashback, reward points, and basic travel perks.

Better Insurance Premiums

Some insurance providers consider your credit score to assess risk. A good score can lead to lower insurance premiums.

Easier Access to Emergency Funds

A credit score of 718 enhances your eligibility for personal loans or lines of credit, ensuring access to funds during financial emergencies.

Negotiation Leverage

Borrowers with a strong credit score are better positioned to negotiate loan terms, such as interest rates or processing fees.

Lower Financial Stress

With easier access to credit and better financial options, a good credit score can significantly reduce financial stress and contribute to your overall well-being.

Although a score of 718 is good, improving it can provide even greater financial benefits. Here’s how to maintain and enhance your score:

Pay Dues on Time

Timely repayment of credit card bills, EMIs, and loans is essential to maintaining a strong credit score.

Manage Credit Utilisation

Keep your credit utilisation ratio below 30% to show responsible credit management.

Limit Credit Applications

Avoid frequent credit card or loan applications, as hard inquiries can temporarily lower your score.

Monitor Your Credit Report Regularly

Check your credit report periodically to identify and resolve errors that might negatively affect your score.

Maintain a Diverse Credit Mix

Balancing secured and unsecured credit types can positively influence your credit score.

Retain Older Credit Accounts

Older credit accounts with positive payment histories contribute to your creditworthiness. Avoid closing them unnecessarily.

Seek Expert Financial Advice

If needed, consult a financial expert to create a tailored strategy for maintaining or improving your credit score.

A credit score of 718 reflects responsible financial behaviour and grants access to numerous financial opportunities. By maintaining good financial habits such as timely payments and a low credit utilisation ratio, you can safeguard your score while working to improve it further. A strong credit score enhances your financial flexibility and helps secure better terms on loans, credit cards, and other financial products.