Difference Between CIBIL and Experian Credit Score

Checking your credit score is one of the many ways that a financial institution assesses you when you apply for a loan, credit card, or any other credit facility. There are four major credit bureaus in India, namely TransUnion CIBIL, Experian, Equifax, and CRIF High Mark. 

 

Several banks and financial institutions rely on CIBIL and Experian credit scores. While both assess your creditworthiness, there are key differences between Experian and CIBIL scores. 

 

Understanding them can help you understand which credit habits to inculcate and boost your score to get access to credit affordably.

A credit score is a snapshot of your credit health and profile, represented in a 3-digit format. 

Before understanding the differences between Experian credit score vs CIBIL score, having a basic introduction to both metrics is essential. 

The CIBIL score is generated by TransUnion CIBIL Limited, which is one of the most widely recognised credit bureaus in India. It got its license as a credit information company from the RBI under the Credit Information Companies (Regulation) Act of 2005.

The credit score ranges for CIBIL are as follows: 

Experian Credit Information Company of India Pvt Ltd. is another major Credit Information Company (CIC) in India that generates the Experian Credit Score. Registered with the Reserve Bank of India, it is also regulated by the Credit Information Companies (Regulation) Act of 2005.

Credit score ranges for Experian are similar to that of the CIBIL score: 

The following table encompasses the key differences between Experian and CIBIL credit scores.

You can check your CIBIL score on Bajaj Markets without any charges by following these steps: 

1. Click on ‘GET YOUR SCORE’ on this page

2. Enter your details, including name, date of birth, email address, mobile number, PAN, etc. 

3. Select your employment type from the given options 

4. Agree to the terms and conditions to get the OTP

5. Enter the OTP received on the registered mobile number 

6. Click on the ‘GET REPORT’ button to access your credit score 

 

You can also check your free CIBIL score once a year on the official TransUnion CIBIL website. Click on ‘GET FREE CIBIL SCORE & REPORT’ and enter your details to create an account. Thereafter, you must pay a monthly membership fee of ₹550 to check your updated credit score. You can choose a 6-month or annual plan for ₹800 or ₹1,200, respectively.

To check your credit score from Experian, visit the official Experian India website and follow these steps:

1. Click on the 'Free Credit Score’ in the top-right corner 

2. Click on ‘Register Now!’

3. Enter your mobile number and click on ‘Send OTP’

4. Verify your number with an OTP 

5. Select the ‘Free Plan’

6. Enter your details to create an account and click on ‘Get Report

Lenders can check your creditworthiness from any of the four credit bureaus in India. However, TransUnion CIBIL is the oldest and one of the most popular credit bureaus in India. That being said, financial institutions also opt for Experian credit scores to check your credit history and credit management ability. 

The other two trusted credit bureaus in India are CRIF High Mark and Equifax, which also score your creditworthiness between 300 and 900. All these bureaus gather credit information from existing issuers and lenders. Thus, having good repayment and debt management habits helps you maintain a good score across CICs.

The credit scores provided by CIBIL and Experian are both accurate and dependable. However, as the CIBIL score serves as the benchmark for over 90% of Indian credit institutions, CIBIL holds a clear advantage within the country.

 

CIBIL is more widely recognised because it was the first credit bureau established in India and has been acknowledged by the Reserve Bank of India for over 20 years. However, it is important to note that both rating systems are valid and accepted.

 

A comparison of Experian and CIBIL clearly demonstrates that both credit agencies offer reliable credit information services. The lender involved and individual preferences will significantly influence the choice between the two.

 

Regardless of the option selected, it is essential to monitor your creditworthiness regularly and follow disciplined financial practices.

Credit bureaus calculate your score based on your past record and current credit behaviour. This is why your score is likely to be within the same range across two or more credit bureaus. If there is a difference, it is usually due to three reasons:

Reporting of Financial Institutions

Sometimes, financial companies may report to only one or two of the four credit bureaus in India. This can impact your score based on where you check your creditworthiness. 

Differences in Scoring Models

Bureaus use their own scoring models that give a different weightage to the same factors used to measure your creditworthiness. This can impact your score, too.

 

In some cases, the differences may arise due to additional information being considered by one CIC versus the other. For example, CIBIL only considers credit cards and loans, while Experian may also consider stocks and insurance policies. 

Updating Timelines of CICs

Credit bureaus may update your score based on the latest information from banks and NBFCs either once a month or once in two weeks. This can also change your score depending on when you check it.

Credit scores are calculated as a three-digit numeric summary, usually between 300 and 900. However, the factors bureaus consider to calculate credit scores may be slightly different, and their percentage also varies. 

The parameters that affect both CIBIL and Experian scoring include:

• Payment Record

This is a key factor which determines your creditworthiness based on your past credit behaviour, such as the number of late payments and missed EMIs. With no defaults or delayed payment, your score is usually high.

• Credit Utilisation

This factor shows your dependence on the credit based on how much of the available credit you have used. For instance, using more than 40% of your total credit limit on a credit card affects your score negatively. 

• Length Of Credit History

A longer credit history indicates that you have enough experience with managing repayment. This helps increase your credit score. 

• Types Of Accounts

Another key factor credit bureaus consider is your ability to manage different kinds of credit. This is why if you have a bag of credit mix, including secured and unsecured loans and credit cards, you have a higher chance of having a good credit score. 

• Recent Activity and Enquiries

Every time you apply for a new credit card or loan, issuers and lenders run a credit check. Although not major, this factor also plays a role in your credit score calculation. Frequent hard enquiries by financial institutions damage your score. 

• Overdue Balances and Total Debt

A high debt-to-income ratio and unpaid balances on your credit card also affect your score, bringing it down. Clearing off debts before borrowing anew and paying your credit card bills in full can help you maintain a high score.

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